Rivian Automotive (RIVN) shares closed more than 25% higher on Friday after the electric vehicle (EV) maker’s better-than-expected Q4 helped it record its first annual gross profit.
RIVN pushed past all of its major moving averages (50-day, 100-day, 200-day) as investors reacted to its $1.29 billion quarterly revenue signaling the bullish momentum will sustain in the near term.
Despite the post-earnings rally, Rivian stock remains down roughly 20% versus its December high. Still, UBS believes it’s unlikely to push any higher through the remainder of 2026.
RIVN stock soared on Feb. 13, after management guided for up to 67,000 vehicle deliveries in 2026.
However, UBS analyst Joseph Spak argues meeting that target will require “flawless execution,” especially on the company’s upcoming launch of R2 sports utility vehicle (SUV).
Any potential delays or related hiccups in manufacturing could materially hurt Rivian Automotive, which is already trading at a somewhat stretched valuation following the post-earnings surge.
Plus, the transition to lower-priced R2 could weigh on the company’s margins as well, he added.
In his research note, Spak expressed skepticism about Rivian’s annual gross profit, since much of it came from regulatory credits and software revenue (Volkswagen joint venture) — not vehicle sales.
With management’s guidance for $2.1 billion in adjusted pre-tax loss this year and nearly $2 billion in capital expenditures, the UBS analyst remains concerned about continued cash burn as well.
According to him, Rivian shares are a risky proposition since positive EBITDA may still be years away.
RIVN recalled its R1 vehicles last month and chief executive RJ Scaringe has aggressively trimmed his stake in recent months, which makes this EV stock even less attractive to own in 2026.
What’s also worth mentioning is that UBS is not the only Wall Street firm that’s recommending caution in buying RIVN shares at current levels.
In fact, the consensus rating on Rivian Automotive currently sits at a “Hold,” with the mean target of about $17 indicating no further upside from here.
