Rivian (NASDAQ: RIVN) started 2025 on a strong note, rallying to $16.49 in early January—its highest level since July 2024, after exceeding analyst expectations for yearly deliveries.
However, optimism quickly faded as concerns over EV incentives under President Trump’s administration weighed on investor sentiment.
The stock came under pressure following Rivian’s Q4 and full-year 2024 earnings report. While the company exceeded expectations on earnings per share (EPS) and revenue, its weaker-than-expected 2025 guidance and mounting losses rattled investors.
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The automaker now expects to deliver between 46,000 and 51,000 vehicles this year, falling short of both the 52,000 delivered in 2024 and Wall Street’s forecast of 55,000. Moreover, Rivian projects a loss before interest and taxes of up to $1.9 billion, surpassing analyst estimates.
Further compounding the downturn, Rivian issued a recall of more than 17,000 R1S SUVs and R1T pickup trucks due to a headlight defect that could increase crash risks.
As a result, Rivian’s stock plunged 8% on February 21, and the losses extended to February 24, with shares sliding another 7.29% to trade at $12.03 in what appears to be an immediate fallout from a sharp loss of confidence on Wall Street.
Analyst downgrades Rivian stock price targets
Bank of America analyst John Murphy downgraded Rivian to ‘Underperform’ from ‘Neutral’ and lowered its price target to $10 from $13.
While the firm acknowledged Rivian’s progress toward achieving sustainable gross margins, analysts noted that the company’s softer-than-expected 2025 guidance, a complex Volkswagen partnership, and increasing competition could create long-term headwinds.
The potential rollback of EV incentives under the Trump administration also raises concerns about Rivian’s $6.6 billion Department of Energy loan, closed under the Biden administration.
Cantor Fitzgerald also downgraded Rivian from ‘Overweight’ to ‘Neutral,’ though it raised its price target to $15 from $13.
Analyst Andres Sheppard cited several key factors for the downgrade, including lower-than-expected 2025 delivery guidance, declining electric delivery van sales, and worsening macroeconomic conditions. The firm also expressed concern over new tariffs and the likely removal of the $7,500 EV tax credit, both of which could further dampen demand for Rivian vehicles.
Guggenheim took a slightly different stance, maintaining a ‘Buy’ rating on Rivian but lowered its price target to $16 from $18. Analysts pointed to Rivian’s weaker-than-expected 2025 guidance and cited the removal R1 platform from their valuation model.
Guggenheim highlighted upcoming potential catalysts, including CEO RJ Scaringe’s scheduled presentation at Nvidia’s (NASDAQ: NVDA) GTC conference in March, which could renew investor interest. However, the firm also flagged the possible removal of IRA leasing subsidies as a near-term risk that could further impact Rivian’s financial outlook.
Featured image via Shutterstock
