In a report released yesterday, Adam Jonas from Morgan Stanley maintained a Hold rating on Rivian Automotive (RIVN – Research Report), with a price target of $13.00.
Adam Jonas has given his Hold rating due to a combination of factors impacting Rivian Automotive. The company’s guidance for fiscal year 2025 suggests a slight decline in vehicle deliveries, which is seen as a cautious approach amidst potential regulatory challenges, increased competition, and a leveling off in electric vehicle demand. This conservative outlook is coupled with a forecasted negative adjusted EBITDA, slightly worse than consensus estimates, driven by lower deliveries and increased operational expenses related to joint ventures and technology advancements.
Despite these challenges, Rivian aims to achieve a positive gross margin in 2025, supported by regulatory credits and a strong performance in their newly disclosed Software & Services segment. The company anticipates significant revenue from this segment, bolstered by joint venture efforts with Volkswagen. However, there remains uncertainty around regulatory changes, which could impact financial outcomes. These mixed factors contribute to the Hold rating, as the potential for growth is balanced by existing risks and uncertainties.
Jonas covers the Consumer Cyclical sector, focusing on stocks such as Ferrari, Tesla, and General Motors. According to TipRanks, Jonas has an average return of 3.8% and a 51.73% success rate on recommended stocks.
In another report released yesterday, Barclays also maintained a Hold rating on the stock with a $14.00 price target.