Electric vehicle stocks have been quite the show-stealers as of late, given the anticipated growth potential of the industry. Rivian Automotive, Inc. (NASDAQ: RIVN) in particular has been selling like hot cake in yesterday’s session, climbing by 7.7% overall. The bullish momentum has somewhat stabilized in the aftermarket, with growth falling back down to 0.58%, highlighting perception towards RIVN. This persistent climb traces back to Monday last week, since when RIVN has gained 30.98% in price, pushing until today. The movement highlights the steady and persistent rise of the stock, as opposed to sudden and unpredictable growth spurts observed.
RIVN Financial Performance
When RIVN had started trading a little over four months ago, the stock was all the craze in the market. A promising company with a robust business model and capability to penetrate and capture the electric truck market. The craze around RIVN had lasted for a week following its IPO, during which the stock climbed by over 70%. Following this initial momentum, the ride has been downward for the stock, with a few brief bounce backs occasionally seen. Rivian’s financial performance has been a major driver for this, which has raised concerns about a possible overvaluation by traders. For instance, the company, with its market capitalization of $42 billion managed to deliver only 920 vehicles in all 2021. These factors collectively explain the downward trajectory seen with RIVN, and why its initial growth spurt was unable to sustain.
Ramped up Production Capacity, and RIVN Climb
The RIVN reversal from its bearish trend can be traced to Monday the 14th of March, which was last week. This date coincided with an announcement by the company to ramp up its production for the year. This came in order to better meet the demand for Rivian electric trucks. In order to reinforce the commitment to this move, the company announced its new COO as Frank Klein. Klein who served as president of the auto-parts giant, Magna, brings a wealth of expertise to the company. The move is what has triggered an interest amongst market participants towards RIVN.
RIVN has been on a climb since last week, given the announcement to ramp up overall production. The news brought a reversal of the persistent downward slide the company was facing due to its poor financial performance.