Rivian Stock Shows Promise Amidst Volatility, Analysts Suggest Hold

Company Overview

Rivian Automotive, Inc. (Ticker: RIVN) is a prominent player in the electric vehicle industry listed on the NASDAQ exchange. It has seen some volatility in 2023 with its share price reaching a year high of $37.39 and a low of $11.68. Based on the data from September 27, 2023, Rivian's stock closed at $23.05, a 3.55% increase.

Technical Analysis

On analyzing technical indicators, Rivian holds an RSI of 48, suggesting the stock is neither overbought nor oversold. The MACD results of a 3-month period – a generally positive 0.93 – indicates a bullish market trend. The stock price shows some volatility with an Average True Range (ATR) of 5.41.

Rivian has been trading close to its 50-day moving average ($23.27), and far above its 200-day moving average ($18.34), indicating a positive trend in the short term.

The company has a support level near $22.35 and a resistance level close to $24.7. This implies that if the stock can break through the resistance, the price may increase significantly.

Fundamental Analysis

Fundamentally, Rivian's market capitalization stands at approximately $21.67 billion, with about 940.31 million shares outstanding. The company has a relatively high trading volume with 30.39 million shares traded compared to the average volume of 48.38 million.

However, it is observed that the company reported negative earnings per share (EPS) of -5.94, resulting in a negative price to earnings ratio (PE) of -3.88. This indicates that the company is not currently profitable.

The discounted cash flow (DCF) model, which is designed to estimate the value of an investment based on its return, gives a valuation of around $35.72 per Rivian share.

Analyst Consensus and Price Targets

The analyst consensus indicates a "Buy" rating for Rivian with 11 'buy' recommendations, three 'hold' and two 'sell' recommendations. The price targets range from a low of $14 to a high of $147, with a consensus target of $53.1 and a median target of $33.

Important News and Developments

Recent news reveals that Rivian's stock is outperforming compared to its EV peers and the broader market, primarily due to its promising vehicle production figures and profit margin expansion. Under a potential scenario where the United Auto Workers strike could drag on, Rivian stands to gain as traditional automakers' EV ambitions face headwinds. Notably, a piece of news from a Baird analyst forecasts a 35% upside for the stock, expecting Rivian to report promising quarterly deliveries above Street estimates.

Stock Predictions and Recommendations

Based on the technical and fundamental analysis, the overall sentiment is somewhat positive. For the next trading day on September 28, 2023, the stock price may continue to rise given the recent increase and the positive short-term sentiment centered around it.

For the upcoming week, with the technical indicators and news about Rivian's vehicle production and possible benefits from the Labor Union strike, there are clear expectations of the stock price experiencing an uptick. However, investors should keep in mind the company's fundamentals such as its negative PE ratio and monitor its ability to become profitable in the future before investing.

Therefore, considering these factors, it might be more sensible to categorize Rivian's stock as a "Hold". This status may change based on the company's future earnings reports and overall market trend. It's always essential for investors to consider their risk tolerance and investment horizons before making decisions.