- Rivian stock continues to slide, losing over 8% on Tuesday.
- High growth with no income is not a good combination currently.
- RIVN closes below the $78 IPO price for the first time on Tuesday.
Rivian (RIVN) stock keeps on sliding as the environment for high-growth stocks continues to darken. Rivian (RIVN) of course is very early stage and hardly generates any revenue, meaning it falls further afoul of the current risk aversion afflicting equities.
Rivian Stock News
Analysts are remaining bullish on the stock as the latest reports from Mizuho and RBC show. Mizuho said last week that the departure of the chief operating officer was previously planned and that Europe represented the next stage in the expansion plans. Mizuho kept its buy rating on the stock with a $145 price target.
Mizuho wrote: "We believe RIVN continues to progress to the next stage of its global expansion runway as it looks to Europe and scales its manufacturing. We also note RIVN filed an 8-K after the close stating it hit its DecQ production target with 1,015 vehicles manufactured (R1T/R1S/EDV), slightly above consensus of 1,010, and ~920 vehicles delivered." The timing may be a bit off as the latest data from the EU shows new car sales falling nearly 23% in December.
Additionally, on January14 RBC kept its buy rating on Rivian (RIVN) stock with a $165 price target. RBC also thinks that Ford (F) may reduce its stake in Rivian, which is said to be a 12% holding. "We believe Ford will eventually sell down their RIVN investment (tactically) so from an enterprise value perspective we are effectively treating this as cash." Ford said yesterday it will record an $8.2 billion gain on its Rivian investment during its Q4 results. Ford will report results on February 8.
Rivian Stock Forecast
RBC thinks Ford will sell Rivian, and clearly others too are selling the stock. Closing below $78 for the first time yesterday is bound to set alarm bells ringing for some IPO investors who may look to exit the high growth name. The previous triangle formation played out perfectly by reaching our $75 target. $88.39 remains the key resistance and below this Rivian is bearish.
Rivian (RIVN) stock chart, daily
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