Deutsche Bank moved Rivian Automotive Inc. (RIVN) from a Hold to a Buy rating, raising its price target to $23 from $16. That new target implies roughly a 64% upside from the stock's current price of $14 and sits within the analyst range of $10 to $25.
Analyst Edison Yu framed the decision around what he described as "early signs that the company’s prospects are inflecting," adding that the 2026 outlook appears "de-risked" on the basis of reasonable volume expectations and improving vehicle costs. Deutsche Bank also said Rivian’s R2 program looks to be on track for a second-quarter launch.
Technical indicators add context to the upgrade: the stock is trading in oversold territory according to relative strength index (RSI) readings, which Deutsche Bank sees as supportive of its more bullish stance. The share price has nevertheless fallen nearly 29% year-to-date, even as the company posted 28% revenue growth over the last twelve months.
Rivian’s fourth-quarter results provided concrete drivers for the reassessment. The company reported revenue of $1,286 million, beating Deutsche Bank’s estimate of $1,251 million and the consensus view of $1,260 million. Software & Services revenue reached $447 million, of which $273 million was attributed to Volkswagen, and the quarter included $29 million in unexpected credits.
Profitability metrics showed clear improvement versus some expectations. Gross profit for the quarter was $120 million, well above Deutsche Bank’s estimate of negative $17 million and the consensus of $43 million, producing a 9.3% gross margin for the period. Adjusted EBITDA losses narrowed to -$465 million, outperforming estimates of -$560 million from Deutsche Bank and a -$572 million consensus. Despite the quarterly momentum, a look at the trailing twelve months shows a much lower gross profit margin of 3.32%.
On the balance sheet, Rivian finished the quarter with $6.6 billion in total liquidity. Capital expenditures were $463 million for the period, materially below Deutsche Bank's expectation of $600 million. The firm highlighted additional funding sources that will further back Rivian’s balance sheet this year, including $2 billion from Volkswagen and a Department of Energy loan. A reported current ratio of 2.71 indicates liquid assets comfortably exceed short-term obligations.
The company’s reported fourth-quarter earnings also contained modest upside against forecasts. Rivian posted EPS of -$0.70, marginally better than the expected -$0.71, a positive surprise of 1.41%. Revenue of $1.29 billion beat expectations of $1.27 billion, a surprise of 1.57%. These results were followed by a notable increase in the stock during premarket trading.
The combination of stronger-than-anticipated quarterly performance, manageable capital spending, clear external funding commitments and a product timeline that appears intact formed the basis for Deutsche Bank’s upgraded view. For investors and market participants monitoring electric vehicle manufacturers, these data points present a more favorable near- to medium-term picture for Rivian while also highlighting where challenges remain.
What to watch next
- Execution of the R2 launch in the second quarter and the impact on production volumes and costs.
- Software & Services revenue traction and the role of partnerships such as the Volkswagen contribution.
- How negotiated or expected funding - the Volkswagen commitment and the Department of Energy loan - are deployed to support operations and investment.