Key Points Rivian received two analyst downgrades this week. Opinions about which direction Rivian stock is headed vary. Rivian stock has the potential to climb higher in 2026 and in the years beyond. 10 stocks we like better than Rivian Automotive › It hasn't been a very encouraging start to the new year for Rivian (NASDAQ: RIVN) stock. Before this week began, shares of the electric vehicle (EV) manufacturer had dipped by more than 2%. The downward trend in Rivian's stock price is continuing thi ...

Rivian Automotive, Inc. (NASDAQ:RIVN) is one of the Must-Watch Stock on Wall Street. On January 12, Wolfe Research analyst Emmanuel Rosner downgraded the stock from Peerperform to Underperform, setting a price target of $16.00. Firm analysts see higher cash burn, rising losses, and limited near-term catalysts for the stock. Rosner noted how the near-term and long-term fundamental setup for the stock has deteriorated, but that there is excitement around RIVN’s Autonomy platform which has led to a surge in ...

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]

Core Viewpoint - Rivian Automotive, Inc. is facing challenges in demand due to tech transitions and policy shifts, leading to a cautious outlook from Morgan Stanley with an Underweight rating and a price target of $12.00 [1] Group 1: Vehicle Deliveries and Production - In Q4 2025, Rivian delivered 9,745 vehicles, marking a 31% year-over-year decline, slightly above Morgan Stanley's estimate of 9,525 but below the consensus forecast of 10,100 vehicles [2] - The company produced 42,284 vehicles and delivered 42,247 vehicles, reflecting a 15% and 18% year-over-year decline respectively, aligning with its guidance [3] Group 2: Future Outlook and Demand - The demand for 2026 is viewed cautiously due to the expiration of the EV tax credit and the evolving tech hardware roadmap, including the introduction of LiDAR for advanced autonomy expected in late 2026 [4][5] - Analysts are focusing on the upcoming Q4 2025 earnings and 2026 guidance, particularly the production ramp of the R2 model, with a report scheduled for February 12, 2026 [3]

Market Overview - The artificial intelligence boom is considered to be in the early stages of a bubble according to hedge fund manager Ray Dalio [1] - US stock markets experienced double-digit gains in 2025, largely driven by AI-related companies, but US stocks have underperformed compared to international stocks and gold [1][2] - Gold prices surged over 60% in 2025, and emerging markets, along with the UK's FTSE 100, outperformed major global markets [2] Geopolitical and Economic Factors - Geopolitical tensions in the Middle East and uncertainty regarding the U.S. Federal Reserve's interest rate policy have contributed to investor concerns [3] - There are expectations that the newly appointed Fed chair and the FOMC will likely push nominal and real interest rates down, which could support prices and inflate bubbles [3] Company-Specific Insights: Baidu, Inc. - Baidu, Inc. is recognized as a leading AI stock, with 33 hedge fund holders [7] - Jefferies analyst raised Baidu's price target from $159 to $181 while maintaining a "Buy" rating, citing potential value from a recent Hong Kong listing [7] - Baidu plans to spin off its AI chip subsidiary, Kunlunxin, and list it in Hong Kong, with a public offering and share placement [8][9] - The spin-off is contingent on regulatory approvals and is seen as a strategic move to unlock value [9] Company-Specific Insights: Rivian Automotive, Inc. - Rivian Automotive is another notable AI stock with 36 hedge fund holders [11] - Morgan Stanley maintains an Underweight rating on Rivian with a price target of $12, citing challenges in near-term demand due to tech transitions and policy shifts [11] - Rivian delivered 9,745 vehicles in Q4 2025, reflecting a 31% year-over-year decline, slightly above estimates but below consensus forecasts [12] - The company produced and delivered 42,284 and 42,247 vehicles respectively, both showing year-over-year declines in line with guidance [13] - Demand for Rivian's vehicles in 2026 is viewed cautiously due to the expiration of the EV tax credit and evolving technology, including the introduction of LiDAR for advanced autonomy [14][15]

Core Insights - Rivian Automotive hosted its first Autonomy & AI Day, emphasizing stronger autonomy, improved AI, and a more capable tech platform for future models [1] - The company is facing a slowdown in U.S. EV demand and increased price competition from Chinese automakers [2] - Rivian's stock has risen 24% year-to-date but remains 79% below its IPO price [2] Technology Developments - Rivian introduced its in-house silicon chip, the Rivian Autonomy Processor (RAP1), designed for heavy AI and vision workloads, delivering 205 gigabytes per second bandwidth [4] - The new hardware will support an AI-powered "Rivian Assistant" and near-term software updates for hands-free driving on over 3.5 million miles of North American roads [5] - Integration of LiDAR into future models aims for Level 4 self-driving capabilities, positioning Rivian closer to competitors like Waymo [6] Product and Market Strategy - Rivian plans to launch the affordable R2 model in the first half of 2026, targeting a starting price of around $45,000 [10] - A partnership with Volkswagen involves an investment of up to $5.8 billion by 2027, focusing on developing next-generation electrical architecture and software [11] Financial Overview - Rivian's cash balance decreased to $7.1 billion at the end of Q3 2025, with a high capex forecast of $1.8–$1.9 billion [12] - The company has lowered its 2025 delivery guidance to 41,500-43,500 units, down from previous estimates [13] - Zacks Consensus Estimate projects revenue growth of 8% in 2025 and 36% in 2026, with adjusted EBITDA loss estimates for 2025 narrowing slightly [14][15]

Core Insights - Rivian Automotive's stock surged by 25.4% following a positive third-quarter report, surprising investors with a gross profit of $24 million instead of the expected loss of nearly $40 million [1][3][9] - The automotive division showed significant improvement in gross profit, and the software and services segment achieved a 37% gross margin [3][9] - Rivian successfully reduced its cost of automotive revenue per vehicle delivered by $19,000 compared to the previous year, while maintaining its guidance amid a competitive EV market [4] Company Developments - Rivian is set to begin deliveries of its new R2 model in the first half of 2026, with production starting at its expanded Illinois factory [5] - The company broke ground on a new facility in Georgia during the third quarter, which will support long-term capacity growth for its new mid-size platform [5] - Recent uncertainties had previously led to a drop in shares, but the outlook has improved significantly following the latest report [5][6]

Market Overview - The U.S. stock market experienced a downturn, with major indices like the S&P 500 and Nasdaq showing negative futures [1] - The Dow Jones Industrial Average fell 0.5% to 47,085.24, the S&P 500 dropped 1.2% to 6,771.55, and the Nasdaq decreased 2.04% to 23,348.63 [2] Company Performance Advanced Micro Devices Inc. (AMD) - AMD reported third-quarter revenue of $9.25 billion, exceeding analyst expectations of $8.74 billion [3] - Adjusted earnings per share were $1.20, surpassing estimates of $1.16, driven by growth in the AI data center business [3] - AMD shares fell 3.70% to close at $250.05, with after-hours trading showing a further decline of 4.7% to $238.20 [2] Super Micro Computer, Inc. (SMCI) - Super Micro Computer reported earnings of 35 cents per share, missing the expected 40 cents, leading to a stock decline [4] - Quarterly revenue was $5.01 billion, below analyst estimates of $5.99 billion and down from $5.93 billion a year earlier [4] - The stock dropped 6.40% to $47.50, with after-hours trading showing a decline of 9.5% to $42.99 [3] Upstart Holdings, Inc. (UPST) - Upstart reported earnings of 52 cents per share, beating the estimate of 42 cents, but revenue fell short of expectations [6] - The company projected fourth-quarter revenue of $288 million, below the $303.61 million analyst estimate, and cut its fiscal 2025 revenue outlook to $1.03 billion from $1.05 billion [6] - Shares slid 2.73% to $46.24, plummeting 15.3% to $39.15 in extended trading [5] Pinterest Inc. (PINS) - Pinterest reported third-quarter revenue of $1.05 billion, aligning with analyst estimates, but adjusted earnings of 38 cents per share missed the expected 42 cents [8] - The company forecasted fourth-quarter revenue between $1.31 billion and $1.34 billion, slightly below estimates of $1.34 billion [8] - Shares decreased by 2.39% to $32.91, dropping sharply by 20.09% to $26.30 in after-hours trading [7] Rivian Automotive (RIVN) - Rivian reported third-quarter revenue of $1.56 billion, up 78% year-over-year and above the $1.50 billion estimate [11] - Automotive revenue rose 47% to $1.14 billion, while software and services revenue surged 324% to $416 million [11] - The stock fell 5.23% to $12.50, but gained 3.2% to $12.90 in extended trading [10]

Core Thesis - Rivian Automotive, Inc. is positioned at a critical inflection point with positive cash flow from operations achieved in Q2 2025, indicating the viability of its vertically integrated platform [2] - The upcoming R2 model, a two-row SUV priced under $50,000, is expected to significantly expand Rivian's revenue while maintaining cost efficiency [2][3] Financial Performance - Rivian's software capabilities have generated $372 million in annualized revenue, a substantial increase from $84 million the previous year, largely due to a joint venture with Volkswagen [3] - The company has a market capitalization of $18.5 billion and a price-to-sales ratio under 4, suggesting that the market has undervalued Rivian's potential [5] Strategic Partnerships - The partnership with Volkswagen includes a $1 billion equity investment, showcasing Rivian's ability to provide a scalable software stack across various vehicles [3] - Rivian's strategic shift is supported by its software platform, which positions it as a competitor to Tesla in the automotive software space [3] Long-term Opportunities - Rivian aims to become a next-generation automotive platform for legacy OEMs, similar to historical examples of Ferrari and Buick [4] - The company is also exploring new mobility solutions and advancing autonomous features to broaden its platform's reach [4] Market Sentiment - Despite Rivian's potential, it is not among the 30 most popular stocks among hedge funds, with a decrease in hedge fund portfolios holding RIVN from 41 to 38 [7] - The stock has appreciated approximately 46% since a previous bullish thesis, indicating growing investor interest [6]

RT Bloomberg TV (@BloombergTV)Rivian is reworking a key element of its vehicle doors after employees and customers raised concerns over potential safety issues with the current design, according to people familiar with the matter. @EdLudlow has the breaking news on the R2 model https://t.co/aMthbOiCxB https://t.co/C0qw2URkaY ...