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HomeMarketRivian Picks Up Buy Rating. Its Product Line Up and Amazon Partnership...

Rivian Picks Up Buy Rating. Its Product Line Up and Amazon Partnership Shine.

Rivian’s partnership with Amazon is one reason an analyst likes shares of the EV startup.

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Jamie Kelter Davis/Bloomberg

Automotive and electric vehicle investors have had a tough time of it lately.
Rivian Automotive
investors will hope a new Buy rating can help turn the tide.

Cantor Fitzgerald analyst Andres Sheppard has initiated coverage of Rivian (ticker: RIVN) Tuesday with a Buy rating and $22 price target.

He likes Rivian’s product line up–trucks and SUVs–which are big segments of the U.S. auto market. Sheppard also believes that Rivian’s partnership with
Amazon.com
(AMZN) is a positive. Amazon holds Rivian shares and has ordered 100,000 electric delivery vans from the startup.

Rivian stock isn’t getting much of a bounce from the bullish call. Shares are up about 0.2% in premarket trading.
S&P 500
and
Dow Jones Industrial Average
futures are flat.

A couple of issues are working against a bigger reaction. The target price is very close to where the stock is trading. Rivian stock closed at $22.03 on Monday. And there is other research out on Rivian.

Monday evening, Mizuho analyst Vijay Rakesh cut his Rivian stock price target to $50 from $58-a-share, citing rising interest rates and inflation, two issues making 2023 more difficult for all auto makers. Rakesh also rates Rivian stock Buy.

Overall, about 60% of analysts covering Rivian stock rate the share Buy, according to FactSet. The average Buy-rating ratio for stocks in the S&P 500 is about 58%. The average analyst price target is about $46-a-share.

Wall Street target prices can usually be read a couple of ways. They can represent where an analyst believes a stock will go over the coming 12 months. Or they can represent a good price to pay for a stock to earn a nice return out into the future.

Coming into Tuesday trading, Rivian stock is off about 79% year to date. Rising interest rates and inflation have hurt many auto-related stocks harder than most.

Rivian has also had a more difficult time than expected ramping up production. At the start of the year, Wall Street expected Rivian to deliver about 40,000 vehicles. Rivian will end up doing closer to 25,000 vehicles.

Write to Al Root at allen.root@dowjones.com

 

Credit: marketwatch.com

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