Stocks of the Week: Symbotic, Rivian, and Rocket Lab USA in Focus

 

By Mr. Ram

Despite a quieter trading week due to the Thanksgiving holiday, several stocks made significant moves, capturing investor attention. Here’s a closer look at the top performers and movers: Symbotic (SYM), Rivian Automotive (RIVN), and Rocket Lab USA (RKLB).

Symbotic: A Sharp Decline

Symbotic shares took a heavy hit, plunging over 37% on Wednesday. The company announced it would miss the deadline for filing its annual 10-K report for the fiscal year ending September 28, 2024. The delay stems from evaluating the financial impact of a major error in its revenue recognition. Specifically, cost overruns on certain deployments, which are not billable, have skewed system revenue calculations.

Analyst Reactions:

• TD Cowen maintained a Buy rating, calling the market’s reaction overdone.
• In contrast, DA Davidson, Craig-Hallum, and KeyBanc downgraded the stock to Hold/Neutral following the news.

Rivian: A Strong Week with Positive Developments

Rivian had a solid week, with its stock closing over 13% higher on Monday. The boost came after Tesla (TSLA) announced a conditional settlement in a 2020 lawsuit accusing Rivian of poaching employees to steal electric vehicle trade secrets. While details are scarce, Tesla plans to dismiss the case by December 24 if settlement terms are met.

Key Highlight:
Rivian also secured a conditional $6.6 billion loan commitment from the U.S. Department of Energy’s Advanced Technology Vehicle Manufacturing Loan Program. This funding aims to accelerate EV design, development, and manufacturing in the U.S.

Analyst Take:

• Truist viewed the loan announcement positively, noting it provides an additional capital avenue alongside Rivian’s partnership with Volkswagen. However, they emphasized that the focus remains on the R2 startup in Georgia due to its nearer-term impact.

Rocket Lab USA: Riding High on Successful Launches

Rocket Lab USA saw its shares surge more than 18% this week, trading around $27.32. The rally was fueled by two key developments:

1. A $23.9 million award from the U.S. Department of Commerce, under the CHIPS and Science Act, to support semiconductor manufacturing expansion in New Mexico.
2. Completing two successful satellite launches within 24 hours—an impressive operational milestone. The first launch occurred in Virginia, followed by the “Ice AIS Baby” mission from New Zealand, placing five satellites into orbit for Kinéis, a French IoT satellite operator.

Analyst Boost:

• KeyBanc raised its target price for Rocket Lab to $27 from $12, maintaining an Overweight rating, signaling strong confidence in its future growth.

Conclusion:

This week’s market action underscores the dynamic nature of the stock market, with Symbotic facing challenges, Rivian gaining ground through legal and financial wins, and Rocket Lab showcasing operational strength. Investors should watch these developments closely as they could signal broader trends in the tech and EV sectors.