Why Rivian Automotive Inventory Retains Functioning GreaterNovember 17, 2021
What took place
For the fourth day in a row — the fourth day since its original community offering — shares of electrical car or truck upstart and purported Tesla-killer Rivian Automotive (NASDAQ:RIVN) marched greater Tuesday.
Through 10 a.m. EST, Rivian shares have previously obtained yet another 6.3% irrespective of there staying no new news now to demonstrate the enthusiasm.
No new news about Rivian, that is to say. As it turns out, however, a person of Rivian’s competitors in the electric powered auto space, Lucid Motors (NASDAQ:LCID), just claimed its third-quarter 2021 earnings past night — and it appears traders are fairly excited about that a person.
Even though Lucid documented broader losses and decrease product sales than anticipated, traders responded positively to the luxurious electric powered vehicle maker’s announcement that its Lucid Air sedan just received Motor Development‘s Motor vehicle of the Yr award. They had been also pretty pumped to discover that Lucid booked 13,000 reservations for new motor vehicle income in Q3 — and grew that number previous 17,000 over the six weeks due to the fact Q3 ended.
And Lucid was capable to announce that it has started producing automobiles to satisfy all those orders at its Innovative Production Plant (“AMP-1”) in Casa Grande, Arizona, where a “2nd period of building” has by now begun to incorporate 2.85 million square toes of production house.
All of this speaks to the heady tempo at which electric powered car or truck adoption seems to be using area, a fact that bodes effectively for both equally Lucid and Rivian (and Tesla, way too, of class).
All that staying stated, I nonetheless assume buyers will need to be cautious about these corporations, which now carry market place capitalizations of additional than $76 billion (for Lucid) and almost twice that — $141 billion — for Rivian. Suffice it to say that appears an dreadful good deal of cash to pay for a dream, no matter how quickly it is really materializing. The far more so when you look at that until eventually these corporations commence booking some income, and reporting some gains, you can not perhaps know what sort of gain margin they will be earning on their cars and trucks.
Until finally that takes place, you may know the price of Lucid and the value of Rivian — but you will not likely know the benefit of possibly a person of them.
This post signifies the impression of the author, who may perhaps disagree with the “official” suggestion situation of a Motley Fool high quality advisory service. We’re motley! Questioning an investing thesis — even 1 of our own — can help us all believe critically about investing and make selections that enable us come to be smarter, happier, and richer.