D.A. Davidson and Stifel lifted their price targets on Rivian, citing optimism for the upcoming R2 SUV and highlighting the company’s positive financial position in the first quarter — supported by its joint venture with Volkswagen and state fundings.
Last week, the company reported a record gross profit of $206 million for the quarter, surpassing Wall Street expectations and marking its second straight quarter of positive profit.
The result was largely driven by $157 million in revenue from automotive regulatory credit sales. While the EV maker booked most of those credits in the final quarter last year, it reported half of its full-year guidance for 2025 in the first quarter alone.
In a new research note published on Monday, D.A. Davidson raised its price target on Rivian by 15.4% to $15. Based on the EV maker’s previous closing price of $14.26, the firm’s price targets imply an upside potential of 5.2%.
Analyst Michael Shilsky maintained the firm’s Neutral rating on the stock, stating that the quarter was “something of a mixed bag” — an expression that Stifel’s analyst Stephen Gengaro had also used last week referring to the company’s results.
Shilsky acknowledged that “Rivian qualified for and will receive $1 billion of funding from VW at the end of the second quarter, following a second straight quarter of gross profit” and that the “R2 launch remains on-track as well.”
However, the analyst noted that “the company reduced its delivery forecast on the back of customer uncertainties (now down year over year)” and that “tariffs are raising capex [capital expenditures] prices.”
The company now expects capital expenditures of between $1.8-1.9 billion, up from the previous target of between $1.6-1.7 billion.
“We continue to like Rivian‘s products and the promise of R2,” Shilsky stated, “but still view the risk/reward as balanced.”
Stifel
Stifel also raised the company’s price target by 12% from $16 to $18 — which implies a 26.2% upside potential on the shares.
Stephen Gengaro released early notes on Rivian’s first quarter results last week — in which he stated that Stifel remains “supportive” of a “positive longer-term view” on the company.
In a new research note, Gengaro said that the Irvine-based automaker is “making solid progress toward several key milestones,” which include “pursuing a positive gross profit target for 2025, reducing costs, and launching the critical R2.”
The analyst highlighted the “positive gross profit” in the past two quarters — which is a condition on the ‘Rivian and VW Group Technology‘ joint venture.
Volkswagen agreed to invest $5.8 billion in the EV maker as it provides the German automaker with next-generation EV architecture and software.
“We believe Rivian has sufficient liquidity to fund operations through the launch of R2 supported by its balance sheet,” Gengaro said, adding that “with investments from Volkswagen and the DOE [U.S. Department of Energy] loan would have sufficient capital to fund the ramp of the midsize platform in Georgia.”
The U.S. Department of Energy announced earlier this year that it would support Rivian with a $6.57 billion loan as it constructed its EV facility in Georgia for the production of mid-sized electric SUVs.
Additionally, Illinois state officials said last month that the company will receive $16 million in state incentives to help fund a new supplier park adjacent to its manufacturing plant in Normal, which will support production growth, including the upcoming R2 model.
CEO RJ Scaringe stated on last week’s earnings call that the company’s manufacturing plant will be closing temporarily to integrate key manufacturing processes for the SUV.
At the time of writing, Rivian is trading 4.21% higher at $14.86. Over the last twelve months, the stock rose by over 30%.
