Rivian Automotive (RIVN) has drawn fresh attention after a sharp move in its share price over the past 3 months, prompting investors to reassess how its current valuation lines up with recent financial results.
See our latest analysis for Rivian Automotive.
Over the past year, Rivian’s share price return has been relatively muted compared to its recent 90 day share price return of 48.74%, while the 1 year total shareholder return sits at 30.64%. This suggests that momentum has picked up more recently.
If Rivian’s recent move has you thinking about the broader electric vehicle space, it could be a good moment to size up other auto manufacturers that are catching market interest.
With Rivian trading at $19.53, an intrinsic value estimate implying a 53.06% discount, and analyst targets sitting lower at $16.67, you have a split signal: is the market leaving a buying opportunity or already pricing in future growth?
With Rivian last closing at $19.53 against a most-followed fair value estimate of $15.75, the narrative points to a premium that hinges on ambitious growth and profitability assumptions.
The analysts have a consensus price target of $13.85 for Rivian Automotive based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $21.0, and the most bearish reporting a price target of just $7.55.
Curious what earnings ramp, margin shift, and future P/E multiple sit behind that higher fair value line? The full narrative spells out the financial stretch baked into those assumptions.
Result: Fair Value of $15.75 (OVERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, that stretch case can quickly look fragile if EV tax credits fade faster than expected or if cash burn forces fresh capital raises and share dilution.
Find out about the key risks to this Rivian Automotive narrative.
While the most-followed fair value narrative suggests Rivian Automotive looks 24% overvalued at $19.53 versus $15.75, our DCF model points in the opposite direction, with a fair value estimate of $41.60. That implies the shares trade at a 53.1% discount. Which story do you think reflects reality?
Look into how the SWS DCF model arrives at its fair value.
Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Rivian Automotive for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 877 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match – so you never miss a potential opportunity.