Investing

Mizuho Picks Over Rivian, Tesla Data, Says Buy the Shares but Reset Target Expectations

Greg Morcroft

Published: December 22, 2022 10:43 pm

Mizuho analysts cut their price targets for three electric vehicle (EV) makers due to increasing consumer headwinds expected in 2023. The analysts cut Tesla’s (US:TSLA) price target to $285 per share from $330. They trimmed their targets to $28 and $50 per share for Nio (US:NIO) and Rivian (US:RIVN), respectively, down from $34 and $58.

In a note to clients, they cited high interest rates, energy prices, and financing rates as factors that could squeeze affordability and hinder growth in the auto market. The analysts maintained “Buy” ratings for all three EV companies and reduced 2023-2024 production estimates for Tesla and Rivian.

They preferred Rivian in the near term, citing the company’s production ramp, exposure to the US SUV market, and a 32% discount to Tesla on a price-to-sales basis.

Meanwhile, Cantor Fitzgerald analysts initiated Rivian coverage with an Overweight rating and a $30 per share target. They cited Rivian’s differentiated product offering, strong Amazon backing, and a proprietary charging network for the positive rating. The analysts also pointed out that Rivian’s shares have dropped 79% year-to-date, making it a potentially attractive entry point for new investors.

This article originally appeared on Fintel