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Electric Dreams: Rivian's Stock Soars as Company Recharges Investor Confidence

Rivian Automotive (RIVN) - ★★

Ranked #67 in Q3 2024 SMID Equity Rankings

Rivian Automotive (RIVN) has recently experienced a significant rebound in its stock performance, breaking above its 50-day moving average and trading above $16 for the first time since February 2024. The stock has shown impressive gains, up 43% in the last month and nearly 60% over the past three months.

This surge comes on the heels of several positive developments for the electric vehicle manufacturer. Rivian reported second-quarter deliveries of 13,790 vehicles, surpassing Wall Street expectations of about 12,000 units and representing a 9% year-over-year increase. While production dipped to approximately 9,600 vehicles in Q2, down from almost 14,000 in Q1 2024, the company maintains its 2024 production target of 57,000 vehicles.

The recent stock price rally can be attributed to multiple factors:

  1. Joint Venture with Volkswagen: A newly formed partnership with Volkswagen, which includes a cash infusion for Rivian, led Wall Street analysts to raise their stock price targets by an average of $3 per share.

  2. Successful Investor Day: Rivian's late June investor day was well-received, as the company outlined plans to reduce costs and move towards profitability.

  3. Industry-wide EV Sector Rebound: The rise in Rivian stock coincides with a broader rally in the EV sector, exemplified by Tesla's (TSLA) nearly 50% increase over the past month.

On June 29, 2024, our 3rd Quarter SMID Equity Rankings for Rivian set a 12-month price target of $15, representing a 12% upside potential from its then-trading price of $13.42. The stock has already surpassed this target, indicating stronger-than-anticipated investor confidence.

source: TradingView

Looking ahead, Rivian's production goals for the second half of 2024 remain ambitious but achievable, with a target of approximately 17,000 vehicles per quarter. The company has demonstrated its ability to produce at this rate in the past.

As the EV market shows signs of recovery after a challenging start to 2024, Rivian's recent performance suggests a potential turning point for the company and the broader electric vehicle industry. Investors and industry observers will be closely watching Rivian's ability to maintain this momentum and deliver on its production and profitability goals in the coming months.

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The information provided in this report is for general informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. The opinions expressed in the report are our own and are subject to change without notice. We may have a position in the securities mentioned in the report, and we may buy or sell such securities without notice. Any investment decisions made based on the information in this report are solely the responsibility of the recipient. We do not accept any liability for any direct, indirect, or consequential loss arising from any use of this report or its contents.


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