The EV company's stock is down more than 6% in response
Electric vehicle (EV) maker Rivian Automotive Inc (NASDAQ:RIVN) is in hot water this morning, following news that the company recalled almost all of its cars -- roughly 13,000 -- due to a potential steering wheel issue. CEO RJ Scaringe warned customers in a letter Friday that a possible loose fastener could cause the driver to lose steering control. Rivian took action following seven reports likely linked to the problem.
In response, RIVN is plummeting, last seen down 6.6% to trade at $31.70. The security has already erased most of the 13.8% pop it saw last Tuesday following the firm's strong production data. Plus, today's plunge has the security breaking back below recent support at the 100-day moving average. Year-to-date, the equity is down over 67%.
Calls have been popular among options traders despite Rivian stock's dismal deficit. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) calls have nearly doubled puts during the last 50 days.
We mentioned the brokerage bunch's bullish stance during our recent coverage of RIVN, but it bears repeating. With 10 of the 16 analysts in coverage calling the stock a "buy" or better while the 12-month consensus price target of $53.06 sits at a 64.1% premium to current levels, Rivian stock could be susceptible to even more bear notes in the near future.