Rivian Stock Dives After Steep Losses, Slim Production

Rivian (RIVN) reported solid but minimal third-quarter revenue Thursday after the market close, but losses were wider than expected while the EV startup cited production constraints. Rivian stock tumbled in overnight trade.


It’s the first earnings report for Rivian since its November IPO and since the EV startup began limited deliveries. Rivian also announced plans for a second factory, in Georgia.

Wall Street analysts began coverage of the company last week, with most of them initiating Rivian stock at a buy rating although there were a few holds as well. Price targets ranged from $104 to $165, with the mean around $134.

Rivian has only begun deliveries of its all-electric trucks. As of Dec. 15, Rivian produced 652 R1Ts and delivered 386. It also produced and delivered its first two R1S, a three-row seven-passenger SUV. Volume production of the R1S is slated for the spring.

Earlier this week, MotorTrend named the Rivian R1T its Truck of the Year for 2022. The award is another feather in Rivian’s cap, as it beat out Tesla and other automakers in bringing the first all-electric pickup truck to market.

General Motors (GM) will release its luxury Hummer EV in the next few weeks, while the more-affordable Ford (F) F-150 Lightning is due by late spring.

Tesla (TSLA) had planned to launch its Cybertruck in 2021, but it’s been pushed back to late 2022, with volume production not until 2023.

Morgan Stanley analyst Adam Jonas says Rivian is “the one” that can challenge Tesla. Jonas initiated coverage of RIVN stock with an overweight rating and $147 price target.

“We think the R1T/R1S is the most capable/desirable product in the market for about $80,000,” he wrote in a recent note to clients. “The electric delivery van (EDV) has the potential to dominate the fast growing final mile EV fleet, which has been largely unaddressed by the EV market until now.”

Rivian investor Amazon (AMZN) ordered 100,000 of its electric delivery vans in 2019. Jonas says that number is likely to increase to 300,000 through 2025-26. Rivian said it expects to deliver the first batch of vans to Amazon this month.

Rivian Earnings

Estimates: Analysts polled by FactSet expected Rivian to post a quarterly loss of $1.33 a share, while sales were seen reaching $926,400.

Results: Rivian generated revenue of $1 million for the quarter, above views. But it reported a loss of $12.21 per share.

The company said it expects to be “a few hundred vehicles short of our 2021 production target of 1,200.”

Rivian said it had around 71,000 preorders for its R1T pickup and R1S SUV in North America as of Dec. 15. Preorders require a $1,000 refundable deposit.

Rivian said new orders placed today probably won’t be filled until 2023, due to production constraints.

Rivian Georgia Expansion

Rivian announced that it will break ground on a vehicle assembly and battery plant east of Atlanta in Morgan and Walton counties in the Summer of 2022, according an SEC filing on Dec. 16. Production at this facility is slated for 2024. It will have a capacity to produce 400,000 vehicles annually. Rivian already has an assembly plant in Normal, Illinois.

Rivian also apparently is looking to open a plant in Europe by the end of 2023. The U.K. was offering Rivian more than 1 billion British pounds — $1.32 billion — to build a plant in Somerset, the Financial Times reported on Dec. 3.

Stocks Race Higher On Fed Move; These Leaders Flash Buy Signals

Rivian Stock

Shares fell 5.3% to 108.87 in regular trading on the stock market today. Shares dropped 10% in after-hours trading.

Rivian stock, which came public Nov. 10, rocketed as high as 179.47 on Nov. 16, but have since pared back those gains, according to MarketSmith. RIVN stock is up from its 78 IPO price.

If Rivian stock starts moving higher, it’ll soon have an IPO base with an official buy point of 179.57. Investors might look for an early entry.

Rivian’s Relative Strength Rating is a 89 out of a best-possible 99. 

Meanwhile, Tesla stock skidded 5% to 926.92. Rival EV startup Lucid (LCID) lost 1.6%.

Among U.S. legacy automakers with a growing EV slate. GM stock edged lower 0.5%. Ford climbed added 1%.

Toyota Motor (TM), which unveiled its massive push into EVs earlier this week, inched up 0.6%, as it announced higher overall production in January.

China-based EV startups Nio (NIO) fell 2.3%, Li Auto (LI) lost 1.5% and Xpeng (XPEV) declined 2.1%. Warren Buffett-backed BYD (BYDDF) rose 1.8%.

Follow Adelia Cellini Linecker on Twitter @IBD_Adelia.


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