One Potential Catalyst for Rivian Stock Upgrade: A Closer Look at UBS Analyst's Take

One catalyst that could drive this EV maker's stock

In the short term, Spak noted, "We believe the near-term risk/reward is more balanced at current levels" after the recent slide in Rivian shares.

He added that risks that are now reflected in the stock price include slowing EV sales growth in general. But the short interest has also reached over 18% of available Rivian shares.

Any near-term catalyst could spark a short squeeze that would push shares higher. And there is a potential catalyst ahead. Rivian recently introduced the R2 SUV, its next EV offering. The analyst believes that a positive initial update on R2 reservations would support the longer-term potential for the stock.

The R2 won't be available until 2026, but the stock could push higher on any update that has investors anticipating growing revenue in the coming years. With Rivian stock trading near its all-time lows, much of the pessimism surrounding EV demand and slowing sales may already be priced into the stock.

Investors shouldn't look at the short-term movement or whether short covering might push shares higher.

But if the R2 platform, or even the future R3 crossover SUV that will follow, are a hit with EV buyers, Rivian's stock may have bottomed. Risks remain, of course, but investors who believe EV demand will be strong for the lower priced vehicles should consider buying Rivian stock now.