Well, that didn’t turn out very well. Investors decided there wasn’t all that much to like about Rivian’s (NASDAQ:RIVN) latest quarterly readout, sending shares down ~25% in Thursday’s trading session.
The EV maker disappointed on several metrics in Q4. On the plus side, revenue climbed by 99% year-over-year to $1.32 billion, edging ahead of the Street’s call by $60 million. However, Adj. EBITDA of ($1.10) billion, while improving on last year’s $1.46 billion loss, missed the ($1.06) billion consensus estimate. At the bottom-line, adj. EPS of ($1.36) fell short of the analysts’ ($1.33) projection.
If that wasn’t enough of a letdown, things got even hairier with the outlook. Impacted by downtime for factory upgrades, the company expects to produce 57,000 vehicles in 2024, about the same as last year, but some distance below Wall Street’s forecast of 80,000 units. The company also expects an adjusted EBITDA loss of $2.70 billion, also missing consensus calls for a loss of $2.59 billion. As far as cash goes, Rivian saw out the quarter with $7.86 billion in cash and cash equivalents, a drop from the $9.1 billion it exited Q3 with. Finally, Rivian announced a 10% cull to the workforce.
Nevertheless, Baird analyst Ben Kallo remains in the EV maker’s corner, although not quite conclusively as beforehand.
“2024 production guidance was underwhelming with significant changes to RIVN’s manufacturing facility ahead,” Kallo said. “RIVN has discussed this for several quarters and a quarterly decrease was expected; however, the degree of the impact was more severe than our/Street estimates, and we believe will pressure shares in the near term. RIVN has several areas for cost reductions, and we believe RIVN is investing for a strong long-term setup. We continue to like the product, brand, and management, but are removing as a Best Pick for 2024.”
Accordingly, Kallo has also reduced his price target from $30 to $23, although the revised figure still suggests shares will climb 101% higher over the one-year timeframe. Kallo’s rating stays an Outperform (i.e., Buy). (To watch Kallo’s track record, click here)
All in all, the Street is evenly split here; based on 7 Buys and Holds, each, the analyst consensus rates the shares a Moderate Buy. The forecast calls for 12-month returns of ~94%, considering the average target clocks in at $22.15. (See Rivian stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
