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Rivian Automotive Stock Forecast: RIVN Breaks Above $16 Resistance Ahead of Earnings

  • Rivian shares hit an intraday high above $16 on Tuesday for the first time in nearly five months.
  • Rivian has benefited lately from its software partnership with Volkswagen.
  • The upcoming debut of Tesla’s RoboTaxi is also providing a tailwind for electric vehicle stocks.
  • Morgan Stanley has a $33 price target on RIVN, forecasting a 100% gain over the next year.

Rivian (RIVN) rose above $16.00 per share again on Tuesday for the first time since Feb. 21, nearly five months ago, when an earnings release sent Rivian’s stock tumbling.

Rivian is benefiting from renewed interest in the electric vehicle leader Tesla (TSLA)as well as its own association with Volkswagen (VWAGY) and the next earnings announcement in several weeks.

The broader market got a boost on Tuesday after Federal Reserve (Fed) Chairman Jerome Powell signaled in remarks to Congress that he was concerned about keeping rates high for too long. This gave the market greater certainty that interest rates would be cut at the September meeting.

Rivian Stock News

Rivian and other EV stocks have seen their prices rise over the past month, benefiting from the drag effect of EV king Tesla’s rally. Tesla shares have gained about 48% over the past month as excitement builds over Elon Musk’s unveiling of the company’s RoboTaxi offering on Aug. 8.

With a full month to go, traders expect TSLA stock to return to bullish form as the market embraces Tesla’s entry into the self-driving taxi industry, an industry that is expected to grow to $600 billion in revenue globally by the end of the decade.

Of course, Rivian doesn’t have a self-driving taxi division. But RJ Scaringe’s preoccupation with electric pickups and SUVs is generating excitement over the June announcement of a software partnership between it and Volkswagen. The world’s second-largest automaker has agreed to invest up to $5 billion in Rivian to gain access to the smaller company’s technology licenses.

Essentially, the news suggests that Rivian’s technology is good enough that Volkswagen wants to base its next-generation EV software and architecture on Rivian’s platform. Morgan Stanley has a $33 price target on Rivian largely due to its in-house autonomous architecture, which may be what Volkswagen is going for.

The deal also provides Rivian with the cash to build its next factory, likely in Georgia, where an earlier one was planned. This will allow its mass-market R3 model to reach consumers much faster than expected.

Rivian reported on July 2 that it delivered 13,790 vehicles during the second quarter and is on track to deliver at least 57,000 in 2024. Management has reiterated that it is on track to see positive gross profit in the fourth quarter and positive adjusted EBITDA in 2027.

Rivian Stock Forecast

Rivian shares rose to an intraday high of $16.17 on Tuesday before falling back below $16.00. This is notable because the $14.50 to $16.00 range was support in October and November 2023 and January and February of this year. Breaking above $16 would suggest that the party is not over and shareholders should expect the rally to continue.

A notable price target is $19.50. This is where RIVN stock found support and then resistance in August 2023 into early 2024. Another possibility is $24.00, where its rally ran out of steam in December 2023.

RIVN stock daily chart

Source: Fx Street

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