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Rivian Stock Is Now Down 45% From its Highs. Is the EV Upstart a Buy?

By Joe Tenebruso – Dec 18, 2021 at 1:31PM

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This could be the profit opportunity you've been waiting for.

Rivian (RIVN 0.11%) burst out of the gates following its much-anticipated initial public offering (IPO) on Nov. 10. In a matter of days, the electric vehicle maker's stock price soared as much as 130% from its IPO price of $78. 

Yet since that time, Rivian's shares have fallen back down to Earth. After the EV start-up alerted shareholders to some short-term production challenges during its third-quarter earnings report earlier this week, its stock plunged.

With its shares now trading at a significantly cheaper price, is it finally the time to buy Rivian stock? Two analysts believe it is. Here's why.

An investor is pensively looking at stock charts.

Image source: Getty Images.

Analysts were a bit disappointed when Rivian said supply chain constraints would cause it to fall "a few hundred vehicles short" of its production goal of 1,200 vehicles in 2021. Yet they were quick to highlight the strong consumer demand Rivian is seeing for its electric trucks.

For one, Wedbush analyst Dan Ives projects that Rivian's reservations for its passenger trucks will surpass 100,000 by the second half of next year. Preorders for Rivian's R1T pickup truck rose to 71,000 as of Dec. 15, up from approximately 48,000 at the end of September. In turn, Ives has a buy rating on Rivian's stock and a $130 price forecast for its shares.

RBC analyst Joseph Spak is even more bullish on Rivian's prospects. He sees the EV stock's price rallying roughly 69% to $165 as it overcomes its supply chain issues. Thus, Spak thinks investors should use the recent swoon in Rivian's stock price to pick up shares at a sizable discount to their recent highs.

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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