Rivian Automotive Inc. (RIVN) saw its stock plummet by 5.06% in intraday trading on Tuesday, January 7th, 2025. Despite the significant drop, one Wall Street analyst remained resolutely bearish on the electric vehicle (EV) maker.
Garrett Nelson, an analyst at CFRA, raised his price target for Rivian by 60% to $8 per share but maintained his "sell" recommendation. Even with the increased target, Nelson's valuation suggests a potential downside of 51% from the current stock price. His skepticism stems from concerns over Rivian's ability to achieve positive gross margins and the company's high cash burn rates.
While Rivian reported better-than-expected Q4 production and delivery numbers, the road ahead remains challenging. The EV industry faces headwinds, including potential policy changes and reduced incentives under the new U.S. administration. Additionally, the rise of Chinese EV makers in markets like Norway poses increased competition for Rivian and other established players.