Rivian Automotive price target raised to $14 from $10 at JPMorgan

JPMorgan raised the firm’s price target on Rivian Automotive (RIVN) to $14 from $10 and keeps an Underweight rating on the shares following the “surprise announcement” that Volkswagen (VWAGY) would invest $1B into the company’s equity in each of 2024, 2025, and 2026, while contributing another $2B into a new joint venture. The investment likely replaces external capital that Rivian would otherwise have raised, the analyst tells investors in a research note. However, the firm says the investment does not eliminate the associated dilution risk, including given the price at which the shares will be raised will be determined by the unknown level at which they trade in the 30 days prior to the dates of VW’s investment in 2025 and 2026. JPMorgan cites reduced funding uncertainty near-term and lower execution risk for the target increase.