Rivian (RIVN)

Going by past performance, the market appeared to be expecting the worse ahead of Rivian’s (RIVN) Q1 earnings. Shares shed ~40% off their value in the week leading up to the report, with the stock down by 80% on a year-to-date basis.

However, with a loss per share of $1.43 edging the $1.44 consensus estimate, and the company reiterating its goal to produce 25,000 cars this year whilst touting the strong demand for its offerings, investors appeared to breath a sigh of relief.

Rivian said it now has over 90,000 reservations for its R1-series truck and SUV, up from 83,000 announced in the March update – the most recent one.

These are promising signs, says Wedbush analyst Daniel Ives. “This quarter was not without issues but it does finally appear that Rivian is on the right track with strong demand and a supply chain that should produce 25k deliveries this year reaffirming its guidance,” the analyst added.

That said, Ives is taking anything management says with a healthy dose of salt. Ives has some choice words for the EV start-up, calling its short time on the public markets since the November IPO a “train wreck” and an “overall black eye for the EV industry.” Calling Rivian a disappointment would be an “understatement,” says the analyst.

That is because from a “core engineering and design perspective,” Ives thinks Rivian has the “potential to change the EV and auto industry.”

“However,” warns the analyst, “for that to happen they need to start delivering models to customers and stop the excuses.”

Can Rivian do so? That remains to be seen, although the plans to invest around $5 billion in its Georgia plant to “accelerate” the R2 platform is a “long term positive,” and so are those 90,000 pre-orders, which provide hope that Rivian’s management will be able turn the ship around and begin to “properly deliver what the Street once envisioned.”

All told, while Ives’ Outperform (i.e., Buy) rating stays as is, the price target is slashed in half – from $60 to $30. As such, Ives now see the stock climbing ~11% higher over the coming year.

The Street’s average target remains way more bullish; at $54.15, the figure makes room for one-year gains of ~101%. Overall, based on 9 Buys and 6 Holds, the stock has a Moderate Buy consensus rating.