Rivian Automotive (NASDAQ:RIVN) is experiencing a surge in stock prices following its second-quarter delivery report, which surpassed expectations. The electric vehicle (EV) manufacturer delivered 12,640 vehicles from its Illinois factory during the quarter, exceeding analysts’ predictions of 11,300 cars and trucks. As a result, shares rose by 17.4% in limited trading on July 3 and another 7.7% over the holiday weekend. Currently, RIVN stock is trading at over $21 per share, with a market cap of nearly $19 billion. Although the shares have seen a 21% increase for the year, they are still down 23% over the past year.
Rivian gained significant attention during its late 2021 initial public offering (IPO), with shares trading at nearly $130 each. This was largely due to backing from Ford Motor (NYSE:F) and Amazon, with Ford providing equity and Amazon acquiring a 20% stake in the company. Amazon also placed an order for 100,000 electric delivery vans, with deliveries commencing in the U.S. last year and over 3,000 vans currently in use. Ford sold most of its Rivian stake for a profit last year and now holds just a 1.12% ownership.
Recently, concerns arose regarding Rivian’s relationship with Amazon when the e-commerce giant reduced its order to just 10,000 vehicles for this year. Rivian expressed its intention to terminate the exclusivity agreement on the vans, while Amazon attributed the slowdown to general cost-cutting measures. However, with the introduction of Rivian-made Amazon vans in Europe, investor interest in the stock is once again on the rise. This positive news aligns with strong results from other EV manufacturers such as Tesla (NASDAQ:TSLA), BYD (OTCMKTS:BYDDF), and Li Auto (NASDAQ:LI), indicating a sustained demand for EVs.
Looking ahead, the EV market remains volatile, particularly for smaller players like Rivian. The company must continue to execute its plans effectively to avoid being overshadowed by competitors. Rivian’s future goals include completing a $5 billion plant in Georgia for production in 2026 and introducing a new platform called the R2, featuring a compact SUV priced at $40,000.
Disclaimer: The opinions expressed in this article are those of the writer and do not necessarily reflect the views of InvestorPlace. As of this writing, the writer holds a long position in AMZN.
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