JPMorgan analyst weighs in on Rivian ahead of Q3 2024 earnings
Rivian's (NASDAQ:RIVN) third quarter 2024 earnings is almost here, and analysts are weighing in on the electric truck maker's potential results. These include JPMorgan analyst Ryan Brinkman, who shared his thoughts on Rivian in a note to clients.
Rivian stated in its Q3 2024 vehicle delivery and production report that it was revising its annual production guidance to between 47,000 and 49,000 vehicles due to supply chain issues. The company, however reaffirmed its annual delivery output to be in the range of 50,500 to 52,000 vehicles for 2024.
Considering these updates from Rivian, concerns are now abounding about whether the supply chain issues that the company faced in Q3 would affect its profitability forecast for the coming quarter. JPMorgan analyst Ryan Brinkman noted that this is unlikely, though he also noted that JPMorgan has adjusted its outlook for Rivian's full-year deliveries to 49,000 vehicles, as noted in a Yahoo Finance report.
"2024 full year deliveries guidance was reiterated at ~50-52K despite the production shortfall, implying unchanged demand, although we note that the softer deliveries in 3Q do not on the surface appear supply-related. The implied softer demand trend suggests at least some risk to the outlook for full year deliveries, to which we move to 49,000 from 54,000.
"(Softer demand) further lowers our (production) estimates, although the biggest income statement effect is on revenue, given we estimate the company is now likely operating close to contribution margin breakeven (and free cash flow should even benefit, on implied inventory drawdown)," the JPMorgan analyst noted.
Analysts polled by Bloomberg currently expect Rivian to report revenue of $980.26 billion for Q3 2024, lower than the $1.34 billion that the company generated a year ago. Rivian is also expected to report an adjusted loss per share of $1.11, with an adjusted EBITDA loss of $657.5 million.
Rivian will release its Q3 2024 financial results after markets close today, At 5:00 p.m. ET, the company will host an audio webcast to discuss the performance and outlook for the business. The live webcast of Rivian's Q3 2024 earnings call can be accessed here.
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