10 Stocks with Biggest Upside Potential According to Hedge Funds

4) Rivian Automotive, Inc. (NASDAQ:RIVN)

Average Upside Potential: 62.84%

Number of Hedge Fund Holders: 37

Rivian Automotive, Inc. (NASDAQ:RIVN) designs, develops, manufactures, and sells electric vehicles and accessories.

Rivian Automotive, Inc. (NASDAQ:RIVN) continues to focus on advancements in production, with strategic partnerships to act as a primary growth enabler. Wall Street remains optimistic about its JV with Volkswagen. This JV should help Rivian Automotive, Inc. (NASDAQ:RIVN) in achieving significant cost savings, operating efficiencies, and future revenues. Collectively, these factors should fuel its stock price moving forward.

Rivian Automotive, Inc. (NASDAQ:RIVN) has been ramping up production for its second-generation R1 vehicles and continues to develop the R2 platform. Its focus is also on vertical integration and cost reductions through material and supplier cost savings. Moving forward, Rivian Automotive, Inc. (NASDAQ:RIVN)’s growth is expected to be helped by progression in gross profit via improved variable cost, fixed cost leverage, and a rise in revenue per delivery unit.

In Q2 2024, the company saw total revenues of $1,158 million, mainly aided by the delivery of 13,790 vehicles. Total revenues from the sale of regulatory credits were $17 million for the quarter. Rivian Automotive, Inc. (NASDAQ:RIVN) continues to make investments in expanding its spaces, service infrastructure, and fast-charging network. This will help enhance customer experience and brand exposure.

Analysts at Wedbush reiterated an “Outperform” rating on the shares of the company, issuing a $20.00 price target on 7^th August. Meridian Funds, managed by ArrowMark Partners, released its second quarter 2024 investor letter. Here is what the fund said:

“Rivian Automotive, Inc. (NASDAQ:RIVN) is a US-based electric vehicle manufacturer focused on the design, development, and production of electric adventure vehicles, pickup trucks, and commercial delivery vans. We own Rivian because we believe the company is a future leader in the growing electric vehicle market with a strong brand, compelling products, and a vertically integrated business model. During the quarter, Rivian’s stock price was driven by its progress on cost reduction initiatives and management’s stated confidence in achieving positive gross margins by the end of 2024. The recent announcement of a joint venture with Volkswagen, involving up to $5 billion in investment, also significantly boosted Rivian’s financing outlook and validated its technology. We trimmed our position in Rivian given the strong performance in the quarter.”