What Happened?
Shares of electric vehicle manufacturer Rivian (NASDAQ: RIVN) fell 5.2% in the morning session after Baird analyst Ben Kallo downgraded the stock from Buy to Hold and lowered the price target from $18 to $16. Kallo pointed out that the recently completed Volkswagen joint venture and the unexpected boost from the Department of Energy's funding announcement are "in the rearview." The analyst believes there are limited new catalysts to drive the company's performance in 2025. As a result, Kallo thinks the stock will struggle.
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What The Market Is Telling Us
Rivian’s shares are extremely volatile and have had 52 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 9 days ago when the stock gained 15.2% on the news that Benchmark analyst Mickey Legg initiated coverage on the stock with a Buy rating and $18 price target. Legg believes Rivian can attract more customers, pointing to growing opportunities in the electric vehicle (EV) market. He said, "After a pause this year, domestic EV production is expected to improve in 2025 and further accelerate in 2026 to 2027 as average selling prices decline and the charging infrastructure is built out.".
Rivian is down 33% since the beginning of the year, and at $14.13 per share, it is trading 42% below its 52-week high of $24.35 from December 2023. Investors who bought $1,000 worth of Rivian’s shares at the IPO in November 2021 would now be looking at an investment worth $140.28.
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