Rivian stock has 50% upside from here: Needham analyst

Rivian Automotive Inc (NASDAQ: RIVN) has lost nearly 40% over the past month but a Needham analyst is convinced a sharp rebound is on the cards.

Rivian stock could climb to $22

Chris Pierce lowered his estimate for full-year deliveries this morning to about 70,000 units.

The analyst also expects the related hit to gross margin to push the capital requirement up to $6.0 billion versus his previous forecast for $5.5 billion. That’s after Rivian reported a 10% decline in deliveries for the final quarter of 2023 in early January.

Pierce did also lower his price target on $RIVN today to $22 per share. Compared to where the Rivian stock is trading, however, his forecast still suggests a whopping 50% upside.

Earlier this week, a Baird analyst said peer Nikola Corp could triple from here as well (find out more).

Why is Rivian stock under pressure?

EV stocks have been under immense pressure in recent months due to range anxiety and cost-related slowdown in global adoption.

But Chris Pierce is convinced the downside is now factored into the Rivian stock price. He told clients in a research note on Thursday:

We see RIVN as well positioned ahead of their eventual R2 launch, but in need of positive near term datapoints to ignite investor enthusiasm for a vehicle with a 2026 launch.

Rivian Automotive Inc is expected to reveal its next vehicle – the R2 in the first week of March. The electric vehicles company is expected to lose $1.64 a share in its current quarter versus $1.73 per share a year ago.