Rivian's delivery volume may exceed expectations, but Tesla remains the industry's top choice.
According to the analyst expectations tracked by FactSet, Tesla's deliveries in the third quarter are projected to be 462,000 vehicles, while Rivian's deliveries are estimated to be around 14,000 vehicles.
Rivian and Tesla are both preparing to announce their delivery figures for the third quarter.
Baird analyst Ben Kallo stated that Rivian is more likely to exceed market expectations compared to Tesla, but both electric vehicle stocks are worth considering for investment portfolios.
Tesla remains the industry favorite
Kallo pointed out that Tesla's delivery expectations have been affected by temporary factory closures and demand issues this quarter.
He predicts that Tesla's vehicle deliveries for this quarter will be 439,200 units, a 6% decrease from the previous quarter. Analysts tracked by FactSet generally expect Tesla's deliveries to be 462,000 units.
However, Kallo mentioned that despite the challenging environment for selling new cars, strong demand for the new Model 3 in China could provide long-term sales support.
He also stated that the price increases for the Model 3 and Model Y should support profit margins. Kallo maintains a target price of $300 for Tesla and rates the stock as outperforming the market.
The Baird analyst said, "We still believe that Tesla is in the best position among its peers and recommend it as the top choice for the second half of 2023."
Rivian's delivery figures may exceed expectations
Compared to Tesla, Rivian's presence in the market is relatively small, but Kallo optimistically believes that its delivery figures could surprise the market.
According to FactSet's consensus, Rivian is expected to deliver approximately 14,000 units in the third quarter.
"We expect the delivery figures for the third quarter to exceed consensus. Concerns about weak demand have led to recent weakness in the stock price, but we believe that with improved production capacity, the potential demand remains strong," wrote Kallo.
Analysts suggest that Rivian's turning point may come next year when it provides more details about its R2 production platform plans and upgrades the capacity of its existing R1 factory.
Baird has set a target price of $30 and rates Rivian's stock as outperforming the market.
