Things are finally falling into place for Rivian (RIVN). The Amazon-backed EV start-up came flying out the gates last November, announcing itself as one of Wall Street’s hottest IPOs in recent times.
However, what has followed since has been nothing less than “brutal production woes,” says Wedbush’s Daniel Ives. And these have significantly soured the narrative around the highly promising EV player (and sent its share price crashing). That said, there are now concrete signs Rivian might be turning a corner.
Last week, the company announced Q2 delivery and production figures, and both came in above Street expectations, signaling to Ives that the company is moving in the right direction,
“The performance last quarter coupled with the 2Q delivery numbers show that Rivian (and the management team) is finally starting to get their act together and live up to some of the massive hype for the company,” the 5-star analyst opined.
Importantly, management also said it remains on course to meet its production target of 25,000 vehicles in 2022. As such, by indicating it can successfully navigate through the current challenging supply chain environment, Rivian “is beginning to gain some Street credibility.”
And there are other positive signs, such as the the investment in the Georgia facility which will “accelerate” the R2 platform – the lineup of new vehicles which are set to be more affordable.
Add in the United States/Canada’s more than 90,000 pre-orders and winning Motor Trend’s 2022 Truck of the Year, and Ives is “starting to gain confidence that Rivian management can turn this ship around and begin to properly deliver to what the Street once envisioned.”
For Ives, from a “core engineering and design perspective,” Rivian has always had the potential to become a major EV force. The analyst sees a big EV market opportunity ahead, but to capture it, it is now all about “execution.”
Accordingly, the new upbeat outlook means Ives raises his price target from $30 to $40, suggesting shares can climb ~33% higher over the one-year timeframe….