Shares of EV startup Rivian (RIVN) are up over 14% Friday after Wedbush analyst Dan Ives upgraded his price target. Ives cited the EV maker is making “a major turning point” in its execution strategy, raising Rivian stock price target to $30 a share from $25.
Rivian stock price target upgrade fuels rally
Rivian’s stock rally has lasted over a week, with share prices increasing over 80% since June 27, 2023.
After shattering analyst estimates earlier this week, delivering 12,640 electric vehicles, and producing 13,992 units in the second quarter, Rivian stock rose over 13% alone. Since then, Rivian shares have continued trending higher.
Despite a slow start to the year, producing 9,395 EVs in Q1, Rivian eased concerns, saying it was retooling its electric delivery van (EDV) assembly line to add room for its new Enduro drive units and LFP battery packs.
The move was designed to improve efficiency and streamline production to boost output throughout the rest of the year.
Rivian’s CFO, Claire McDonough, explained last month in an interview that the company was beginning to see relief in its supply chain after overcoming hurdles throughout last year.
McDonough said Enduro production was ahead of schedule as the first saleable R1 model fitted with the drive unit came off the assembly line in Q2. Rivian is shifting its focus from its flagship R1T electric truck to its R1S electric SUV to meet “a robust backlog of preorders that extends into 2024.”
The progress was enough for Ives to upgrade his Rivian stock price target (via Barrons), as he noted the company was “making a major turn towards executing on its longer-term strategy.” Ives added:
After quarters of disappointing production speed bumps, supplier issues, and what felt like an ongoing agita situation, Rivian now appears to have its production and supply chain issues well under control with the laser focus on getting deliveries in the hands of eagerly awaiting customers.
RJ Scaringe, Rivian’s CEO and founder, echoed a similar statement in an interview with BloombergTV this week. Scaringe explained, “What we saw in Q2 was the beginnings of the supply chain really running in a healthy way.”
He said the company had its first board room meeting where the supply chain slide had no red on it, indicating an issue. Instead, Scaringe says Rivian’s supply chain is healthy and keeping up with production.
Rivian recently expanded into Europe, well, in a way. Amazon is rolling out a specially designed Rivian EDV for Europe, with the first 300 ready to hit the streets of Munich, Berlin, and Dusseldorf over the next few weeks.
Scaringe says the expansion is “the beginning of opening up the European market for our products” with predictable plant service and delivery intervals.
Rivian’s stock is up over 80% over the last ten trading days, hitting its highest price since December 2022. Meanwhile, share prices are still down over 85% from their all-time highs achieved shortly after going public in November 2021.
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