With its key figures for the second quarter of 2023 presented at the beginning of August, Rivian was able to exceed analysts’ sales and earnings expectations. Rivian founder and CEO RJ Scaringe, who has now received a significant salary increase, also benefits from the company’s success.
• Rivian exceeds sales and earnings expectations in Q2
• Founder and CEO RJ Scaringe receives raise
• Rivian Stock: Analysts Torn
Rivian beats sales and earnings expectations
Electric vehicle manufacturer Rivian increased its sales and reduced its loss in the second quarter of 2023. The Tesla competitor generated sales of $1.12 billion, after $364 million in the same period last year, and reduced its net loss from $1.712 billion to $1.195 billion. Rivian produced 13,992 vehicles and delivered 12,640 in the second quarter, an increase in production of nearly 50 percent compared to the first quarter of 2023, the company said. And so Rivian has raised its production target for this year to 52,000 vehicles.
Rivian CEO gets big raise
One person who is benefiting from the positive development at Rivian is founder and CEO Robert Joseph (RJ) Scaringe. In a filing with the U.S. Securities and Exchange Commission toward the end of August, Rivian said that Rivian’s Board of Directors, based on the recommendation of the Board’s Compensation Committee, approved an increase in RJ Scaringe’s annual base salary of $650,000 to $1 million, effective as of August 25, 2023, approved.
He also received “an increase in his targeted annual incentive bonus opportunity from 50% to 100% of his annual base salary,” effective from the beginning of next year, and “a grant of a stock bonus […] under the Company’s 2021 Incentive Award Plan, with an aggregate grant date value of approximately $15 million, consisting of half restricted stock units (RSUs) and half stock options, effective August 25, 2023 According to Rivian, both the RSUs and the stock options vest over four years if Scaringe remains with Rivian, according to the document Rivian filed with the SEC.
Rivian shares in focus
However, the better-than-expected results that the electric vehicle manufacturer announced in early August failed to boost the stock. Since the figures were presented, Rivian shares on the NASDAQ have fallen 5.5 percent to most recently $23.42 (closing price on September 7, 2023). Since the beginning of the year, the paper has gained around 27 percent.
Analysts are torn about Rivian shares: According to MarketWatch, analysts mostly praised Rivian’s upside potential, but then tempered expectations due to the company’s capital burden as it expands production. Just a few weeks ago, Cantor Fitzgerald analyst Andres Sheppard downgraded Rivian shares from “overweight” to “neutral,” but at the same time raised the price target from $27 to $29. The analyst pointed to the stock’s outperformance and increasing competition from Ford, GM and Tesla’s Cybertruck, which is expected to hit the market soon.
At TipRanks, Rivian shares are currently rated by 19 analysts – 12 of whom gave it a buy rating, 6 gave it a hold rating and one analyst gave it a sell rating. Analysts’ average price target for Rivian shares is $28.32, which represents an upside potential of around 21 percent from the current share price. The highest price target is $44.00 (almost 90 percent above the current price) and the lowest is $12.00 (around 50 percent below the current price), which illustrates the widely divergent assessments of analysts.
Editorial team finanzen.net
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