Wolfe Research Downgrades Rivian on Rising Cash Burn Risks

Core Viewpoint - Rivian Automotive has been downgraded to Underperform from Peer Perform by Wolfe Research, with a price target set at $16, citing a challenging risk-reward profile and deteriorating fundamentals [1] Group 1: Financial Projections - Wolfe Research forecasts an EBITDA loss of $2.1 billion for Rivian in 2026, which is worse than the consensus expectation of a $1.76 billion loss [2] - The firm anticipates that free cash flow burn will exceed $4 billion, driven by increased capital expenditures, operating costs, and working-capital pressures [2] Group 2: Demand and Product Outlook - There is a noted downside risk to near-term demand for Rivian's R2 model, with expected volumes heavily skewed towards the fourth quarter of 2026 [3] - Unlike Tesla, Rivian is perceived to lack near-term autonomy or AI-related catalysts, with significant technology launches not expected until late 2026 [3]