Rivian stock price risk and reward analysis: 165% surge is possible

Rivian stock price has slipped sharply this week, joining other technology companies like Tesla and NVIDIA. It has slipped in the last two straight days, reaching a low of $11.45, its lowest swing since November 26. It is down by 35% from its highest level this year. Let us explore whether it is safe to buy the RIVN stock dip.

Rivian has turned a gross profit

Rivian’s business has done well in the past few years as its annual revenue jumped from just $55 million in 2021 to $4.97 billion in 2024. This make it one of the fastest-growing companies in the United States. Its electric trucks are also highly popular in the country. 

The company has also embarked on a path to profitability after losing billions of dollars since its inception. It has achieved that by scale and by cost cuts. The most recent results showed that Rivian made $1.73 billion in revenue, a big increase from the $1.35 billion it made a year earlier. That was a good performance since Rvian is in relatively slowing industry.

Most importantly, Rivian has achieved gross profitability, making $170 million in the fourth quarter. That is a sign that it is matching towards net profitability this year. 

Rivian anticipates that the business will continue doing well this year, with the management expecting that it will deliver between 46,000 and 51,000 a year. That delivery estimate was lower than expected as the management expects the Trump administration to offer less incentives to the EV industry.

It also expects that tariffs will have a negative impact on sales. Trump has pledged a 25% tariff on imported steel and aluminum. He has also said that he will add big tariffs on other items, which will impact its performance.

Analysts are relatively optimistic about the company’s business even as they expect its first quarter revenue to drop by double digits. The average estimate for the first quarter revenue is $991.5 million, followed by $1.42 billion in the second quarter. They expect that its annual revenue will get to $5.34 billion this year and $7.5 billion next year. 

Analysts also believe that the Rivian stock price has some more upside from the current level. They expect that the stock will jump to $15 from the current $11.45. This view is mostly because they believe that its trucks are the most popular in the United States and that they will keep capturing market share. 

Read more: Rivian (RIVN) stock: EV maker’s shares slip despite Fed’s rate cut

Rivian stock price analysis

The weekly chart shows that the RIVN stock price peaked at a record high of $178.75 in 2021. It then crashed to a low of $10.35, where it has been at in the past few months. The stock has remained below the 50-week and 25-week Exponential Moving Averages (EMA), a sign that bears remain in control.

There are signs that the chart is sending mixed signals. On the negative side, the Rivian share price has formed a descending triangle pattern, which is made up of a strong support level and a series of lower highs. If this is the correct pattern, then it means that the Rivian share price will have a strong bearish breakdown, potentially to $10. 

On the other hand, there are signs that the Rivian stock price has formed a triple-bottom pattern, a bullish sign. This sign is also in line with the fact that it is now in the accumulation phase of the Wyckoff Theory, which is usually followed by the markup phase. A strong breakout may see the stock soar to $28.2, the highest swing in July 2023, up by 165% from the current level.