UBS downgraded Rivian Automotive to Sell from Buy with a price target of $8, down from $24. The analyst had been optimistic on Rivian’s product and brand ultimately winning out. However, a rapidly changing electric vehicle backdrop caused the firm to reassess its demand view and makes the company’s current strategy “quite onerous on the ramp to profitability and cash flow.” UBS now sees “more tepid” demand for battery electric vehicles and Rivian’s product. The firm now sees material risk to outer-year consensus expectations. The company likely needs capital raises that now constitute a significant percentage of current market capitalization, the firm adds.
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