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Shares of Rivian Automotive Inc. gained Wednesday after Mizuho analyst Vijay Rakesh got more bullish, citing potential for the electric-vehicle maker to beat its full-year delivery target given continued strong EV sales momentum.
Rakesh reiterated his buy rating on Rivian’s stock
RIVN,
but raised his price target by 11%, to $30 from $27.
The EV maker’s stock climbed 4.4% in morning trading, after running up 2.9% on Tuesday to snap a three-session losing streak, but its gains petered out as the day went on, ending Wednesday’s trading session up less than 1%.
It has rocketed 54.7% so far in July, which puts it on track for the biggest one-month gain since going public in November 2021. The current record monthly gain on a closing basis is 33.3% in July 2022.
Also see: Tesla, Rivian are the most shorted stocks in autos, but the trade is far from profitable
Rakesh said he believes Rivian has been executing well on its production ramps, as evidenced by the company’s strong second-quarter deliveries report.
And with overall industry sales of EVs “ramping well,” Rakesh said he sees potential for Rivian to exceed its 50,000 delivery estimate for 2023.
“After a strong start to the year, we see potential for strong auto sales momentum, specifically for EV, despite headwinds from a stretched consumer and high interest rates,” Rakesh wrote in a note to clients.
Rakesh’s new $30 target ties him with two other analysts for the second-highest of the 24 analysts surveyed by FactSet who cover Rivian. The most bullish analyst is Canaccord Genuity’s George Gianarikas with a $40 target, according to FactSet.
Of the analysts surveyed, 14 were bullish, nine were neutral and one was bearish.
Separately, Rakesh raised his stock price target for General Motors Co.
GM,
to $40 from $30, but kept his rating on the automaker at neutral.
He said that while GM is a “growing player” in the EV space, and while the market for internal combustion engine (ICE) autos has been strong, “we see margin headwinds in its ICE-to-EV transition.”
Rivian’s stock has doubled over the past three months, up 101.0%, while GM shares have gained 14.8%. In comparison, the Global X Autonomous and Electric Vehicles exchange-traded fund
DRIV,
has advanced 38.7% over the same time and the S&P 500 index
SPX,
has tacked on 10.1%.
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