24/7 Wall St. Insights
- Rivian Automotive Inc. (NASDAQ: RIVN) has received two pieces of bad news that raise the question of whether it can survive as an independent company.
- Also: Dividend legends to hold forever.
So far this year, Rivian Automotive Inc.’s (NASDAQ: RIVN) shares have been down 55%, primarily due to a July sell-off. Lucid Group Inc. (NASDAQ: LCID), another tiny electric vehicle (EV) company carefully followed by EV investors, is down 40%. After a strong quarter, the shares of industry leader Tesla Inc. (NASDAQ: TSLA) have been up 8% year to date. The S&P 500 is up 23% for the year.
Rivian has received two pieces of bad news, which raises the question of whether it can survive as an independent company. One concerns unit sales, and the other concerns analyst forecasts.
Rivian throttled back on its expected production for the year because of supplier problems. Its new forecast is to produce 47,000 to 49,000 units this year. Its earlier forecast for the year was a much higher 57,000. And in the third quarter, it produced only 13,157 vehicles and delivered 10,018.
There might be a third problem, but it is too early to tell. Volkswagen has introduced a vehicle car experts say will compete with the Rivian R1S. It is called the Scout Traveler.
Rivian trades at $10.45. The census price target among the 29 analysts that follow it is $16.61. However, they expect the EV company’s revenue to be only a little over $1 billion and earnings to be a loss of $91 per share. At those levels, Rivian is working toward oblivion based on these numbers.
This Is What’s Next for Rivian Fans
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