Putting Rivian Automotive’s Latest Surge In Perspective

Summary:

• Rivian Automotive’s stock surged 11.2% on December 9th due to positive news, including a multibillion-dollar deal with Volkswagen AG and a bullish rating from Benchmark.
• Despite recent gains, I maintain a ‘sell’ rating due to Rivian’s uncertain profitability, high costs, and competitive pressures in the electric vehicle market.
• Rivian’s plans include a $5.78 billion investment from Volkswagen and a conditional $6.6 billion loan from the US Department of Energy for its Georgia plant.
• Rivian’s financials show improved profit margins but significant per-vehicle losses, and future success hinges on scaling production and achieving profitability amidst industry challenges.

December 9th ended up being a really positive day for shareholders of electric vehicle producer Rivian Automotive (NASDAQ:RIVN). Shares of the company closed up about 11.2% on increased optimism for the electric vehicle market and following some

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha’s Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Crude Value Insights offers you an investing service and community focused on oil and natural gas. We focus on cash flow and the companies that generate it, leading to value and growth prospects with real potential.

Subscribers get to use a 50+ stock model account, in-depth cash flow analyses of E&P firms, and live chat discussion of the sector.

Sign up today for your two-week free trial and get a new lease on oil & gas!