The average target price of RIVN is 15 and suggests 14% upside potential. Usually, this means a HOLD recommendation among investment firms. This neutral recommendation suggests no significant price movement, up or down, in the next 12 months. The most optimistic analyst has a target price of 23.0. This translates into 69% upside potential in the best case. On the other hand, the most pessimistic analyst has a target price of 7.1. This is equivalent to 48% downside potential in the worst case. 

Rivian Automotive, Inc. designs, develops, manufactures, and sells electric vehicles and accessories. The company offers five-passenger pickup trucks and sports utility vehicles. It provides Rivian Commercial Vehicle platform for electric Delivery Van with collaboration with Amazon.com. The company sells its products directly to customers in the consumer and commercial markets. Rivian Automotive, Inc. was founded in 2009 and is based in San Jose, California.

Rivian Automotive, Inc.

Consumer Cyclical

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

RIVN reported revenue of USD 5 006mn in the last 12 months, up 1% from FY24. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. EPS fell 21% from FY24 to USD -3.72.

The stock's performance has been mixed in the past six months, with growth following a decline. The stock has lagged its global peers from the same sector and industry (as shown above), underperforming then by 0ppts in total. At the same time, the stock's performance relative to its the peers from the same country and sector is different. The stock outperformed these peers by 7ppts over the past six months and grew 10ppts slower in the past month. With respect to the stock's valuation against its peers, its overall price performance is neutral.

The company has reported very poor EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to -51.3% in the last 12 months, up from -96.4% in FY23. 

Historically, RIVN has reported very poor net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled -76.8%, a growth from -122.5% in FY23. 

Rivian Automotive, Inc. reported a return on equity (RoE) of -50.1% in the last 12 months, down from -47.4% in FY23. 

Another important profitability metric, return on assets (RoA), amounted to -23.7% in the last 12 months, an increase from -31.2% in FY23. 

In the last 12 months, the return on capital employed (RoCE) grew to -28.3%, below the peers. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been -3.3 in the past several years. This ratio implies a fragile shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are minimal. In combination with stringent business standards, shareholder rights are very highly protected.

RIVN boasts very high trading liquidity. The average private investor can sell his common position in the stock immediately. Liquidity is usually very stable and remains extremely favourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. 

No other major risks have been identified.

The risk of default is high. Among the negative credit factors, we point to bleak profitability, negligible return on capital, inadequate interest coverage, and poor cash flow generation. We note resilient historical revenue growth and low margin volatility, among the positive credit factors. 

In highly turbulent market conditions, RIVN is exceptionally volatile. In other words, the stock will be among the worst-performers in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be critical. 

In normal market circumstances, RIVN is exceptionally volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change quite unpredictably. The stock's losses on its worst days (less than 1-5% of the time) will range from critical to immense. 

Based on key historical and expected multiples, the stock is greatly overvalued relative to its peers. 

Rivian Automotive, Inc.

$ 13.76

2

Rivian Automotive, Inc.

$ 13.76

2

Risk factor

Profitability factor

Risk / Profitability

About

About

Risk factor

Profitability factor

$ 13.76

About

About

Rivian Automotive, Inc.

$ 13.76

2

Rivian Automotive, Inc.

$ 13.76

2

Risk factor

Profitability factor

Risk / Profitability

About

About

Risk factor

Profitability factor

$ 13.76

About

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