Rivian Stock Has Zero Upside, According to 1 Wall Street Analyst
Rivian Automotive (NASDAQ: RIVN) stock opened lower Wednesday after reporting earnings Tuesday night. News that the company still plans to produce 57,000 electric trucks this year and is cutting its costs failed to alleviate investor worries about Rivian's dwindling cash balance, as well as its continued inability to earn a profit.
One analyst who's particularly pessimistic about the stock is Wells Fargo's Colin Langan. On Wednesday, Langan cut his 12-month price target on Rivian shares to just $10. Rivian stock closed not far from $10 on Wednesday. In other words, according to Langan at least, there's literally no upside to owning Rivian stock today. And there won't be for at least a year.
What's got Langan so disappointed in Rivian? To begin with, analysts already weren't optimistic heading into the Q1 report, predicting the electric truck company would lose $1.17 per share. But Rivian managed to underperform even that estimate, reporting a $1.45-per-share loss. Sure, Rivian is cutting capital spending and taking other steps to slow its losses, but in a note on TheFly.com, Langan argued the company's "free cash flow burn rate" is still too high.
Source Fool.com
