UBS upgrades electric-vehicle maker Rivian to buy, stock rises

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UBS upgrades electric-vehicle maker Rivian to buy, stock rises
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Steve Gelsi covers banking and cannabis as a Senior Reporter for MarketWatch.

Rivian Automotive Inc.’s RIVN, +4.26% stock was up 2.6% in early trading on Tuesday after UBS upgraded the electric-vehicle maker to buy from neutral, while trimming its price target by $2 to $24 a share. UBS analyst Joseph Spak said the road ahead for the EV company looks brighter after a 20% drop in the stock since Oct. 4 and its issuance of a $1.5 billion green convertible note.

“With the raise out of the way, the market can refocus on improving fundamentals,” Spak said. “While we continue to believe 2024 quarterly production/deliveries can be lumpy owing to plant re-rating, the lower stock price de-risks some of our concerns.” The EV company also appears to be burning through cash at a slower rate. “We still believe positive gross margin in 4Q24 is likely and a catalyst,” he said. “The road ahead looks brighter.

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