Sign InRivian Automotive Stock Shows Positive Momentum and Potential Growth
Summary
Rivian Automotive's stock price declined slightly on August 01, 2023, but technical indicators show positive momentum and potential for growth, although analysts warn of caution due to recent volatility and the company's negative earnings. The upcoming earnings announcement on August 08, 2023, will likely significantly influence the stock price.
1. Overview
Rivian Automotive, Inc. (Ticker: RIVN) is a NASDAQ traded electric vehicle company. On August 01, 2023, the RIVN stock closed at $27.30, registering a decline of $0.34, or 1.23% from the previous session. The stock traded between a low of $26.35 and a high of $27.635. For the year of 2023, RIVN stock has ranged from lows of $11.68 to highs of $40.86. The company has a market capitalization of $25.43 billion, 931.51 million shares outstanding, and traded a volume of 39.81 million shares, slightly below the average volume of 47.77 million.
2. Technical Analysis
The Relative Strength Index (RSI14) is at 57, suggesting a neutral position, neither overbought nor oversold. The stock's 50-day moving average stands at $18.64, while the 200-day moving average is $20.13, indicating a positive short-term and long-term trend as the last close of $27.30 is above both averages. Moreover, the Moving Average Convergence Divergence (MACD) over the past three months is a positive 4.14 suggesting that bullish momentum in the price.
3. Fundamental Analysis
Rivian Automotive, Inc. has a negative earnings per share (EPS) of $-7.10, which results in a negative price-earnings (PE) ratio of -3.85, indicating the company is not generating profits. The Discounted Cash Flow (DCF) model suggests a value of $39.97 per share, indicating a potential undervaluation at the current price.
4. Analyst Predictions and News
The consensus target price among analysts is $53.95 with a high target of $147 and a low of $14. The median target price is $35. Recently Cantor Fitzgerald downgraded the stock to “neutral” while raising the price target to $29. Some analysts suggest caution given the recent rally where Rivian's stock price soared by 66% over the past month. In recent news, Rivian announced the hiring of a new chief policy officer, which could signal strategic navigations in the area of public policy and government relations.
5. Upcoming Events
Rivian Automotive is expected to announce its earnings on August 08, 2023. This announcement could cause significant changes in the stock price.
6. Prediction and Recommendation
Considering the above analysis, one could expect RIVN's price to be relatively stable or slightly increase for the next trading day on August 02, 2023. For the upcoming week, the stock price could be influenced majorly by the earnings announcement on August 08, 2023.
Despite the current overvaluation compared to the DCF model and negative earnings, Rivian's stock shows strong technical indicators with positive momentum and is above both the 50 and 200-day moving averages. Combined with upcoming earnings and recent strategic hiring, these factors could lead to potential growth in the stock price.
However, potential buyers are warned of the high volatility and the recent warning from Cantor Fitzgerald suggests caution. It is recommended that investors Hold onto the stock if they currently own it and analyse carefully the upcoming earnings before making further investment decisions. Potential investors should consider their risk tolerance and investment horizon before deciding to Buy or Sell RIVN stock.
