Key Takeaways
- Rivian shares jumped 9% after UBS upgraded the stock to Buy and kept its $17 price target.
- The upgrade looks well-timed, with the stock near its lowest forward price/sales in three years.
- The main risk is cash: Rivian’s free cash flow was -$1.12 billion in the third quarter.
- The R2 ramp also matters to Tesla, Lucid and Uber.
Rivian Automotive (RIVN) shares rose 9% this morning after UBS analyst Joseph Spak upgraded the stock to Buy, keeping his $17 target. He called the stock’s 19% drop over the past month a buying opportunity ahead of the R2 ramp.
That ramp matters beyond Rivian. The R2 goes after the same buyers as the Model Y from Tesla (TSLA). Uber Technologies (UBER) and its fleet partners are set to buy 10,000 of them as robotaxis. And Lucid Group (LCID) faces the same margin test with less cash.
The R2 is the whole bet
Spak wrote that “initial R2 demand looks solid.” In the third quarter, R2 became Rivian’s best-selling vehicle, and management still expects it to be gross-margin positive by year-end.
Analysts expect revenue to nearly triple from 2025’s $5.4 billion by 2028:
Priced near its lows
Rivian’s forward price/sales was 1.6x at Friday’s close. That’s well below its three-year average of 2.7x and near its 1.5x low:
At today’s price, it’s a touch higher. UBS’s target was about 40% above Friday’s close.
The cash is the catch
Rivian is still burning cash, with free cash flow of -$1.12 billion in the third quarter:
And the share count is up 18% since the end of 2025. So the R2’s margins matter twice over: Rivian’s Department of Energy loan of up to $4.5 billion needs positive gross margin before its first draw.
TIKR tracks 25 analysts on Rivian. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on Rivian, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See Rivian’s Analyst Ratings
Who else is watching
Tesla ended the third quarter with its largest passenger-vehicle backlog in four years. But UBS sees Rivian’s Autonomy+ as a potential US rival to Tesla’s Full Self-Driving. Tesla’s fourth-quarter deliveries, due in early January, will show whether the Model Y feels the R2.
Lucid has a shorter runway: it burned $2.91 billion of free cash flow in the first half of 2026. Its Nov. 9 report should show how it plans to pay for 2027.
Uber bought $300 million of Rivian stock in May. Another $250 million from Uber unlocks once Rivian runs R2s with safety drivers in San Francisco and Miami. When Uber reports on Wednesday, Nov. 4, watch whether management counts Rivian as real robotaxi supply.
Worth the wait
I think UBS has this one right. The stock trades as if the R2 might not work, and so far, the R2 is holding up its end.
Of course, the ramp could still stumble: fourth-quarter deliveries, due in early January, need to reach at least 25,193 to hit the new guidance floor.
So what is Rivian stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
