Needham raises estimates on Rivian (RIVN), adds EV maker to Conviction List

Needham reiterated a Buy rating on Rivian (NASDAQ: RIVN) and raised their 12-month price target for the stock to $28.00 (From $26.00) after the electric automaker reported their 2Q production and delivery results. Needham also decided to add RIVN to its Conviction List (replacing ACVA).

RIVN reported Q2 production of ~14k vehicles, representing an increase of 50% compared to the previous quarter. With such a production boost, RIVN appears to be on track to meet or even surpass its 2023 production target of 50,000 vehicles. The company reportedly delivered about 30k vehicles since disclosing over 110k reservations in 3Q22 before discontinuing disclosure of this metric.

Analyst Chris Pierce wrote in a note, We reiterate our Buy rating, add RIVN to the Needham Conviction List (replacing ACVA), and raise our target to $28 post better than expected Q2 production and delivery numbers. RIVN is answering the three most common questions we get across our EV OEM coverage: (1) is there demand for its vehicles; (2) can the vehicles be manufactured at increasing scale; and (3) is there leverage on per-unit costs. RIVN's recent success is also answering a 4th question, in our view - can an OEM drive a positive brand halo effect ahead of launching its next generation of vehicles. We think RIVN investor sentiment should start to reflect increased confidence in its R2 vehicle, which opens up a significantly larger TAM.”

Shares of RIVN are up 7.92% in pre-market trading on Wednesday.

By Michael Elkins | [email protected]

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