This article will cover Rivian Automotive’s aggressive cash burn, Share price prediction 2025, and Analyst ratings. It’ll also look at the future of this company, including its production goal of 25,000 electric vehicles in 2022. In the end, we’ll have a clearer picture of what Rivian looks like in the next five years. This article is not a sell recommendation.
Rivian Automotive’s production goal of 25,000 electric vehicles by 2022
In its second-quarter results, Rivian Automotive, Inc. announced it had produced 4,401 vehicles and delivered 1,227. While these results were better than last quarter’s, they are still far below the company’s original production goal of 25,000 cars per year. However, the company reiterated its goal of producing 25,000 electric vehicles annually. The company has a very ambitious goal, which it plans to accomplish by 2022.
Currently, the company is working to clear a large backlog of reservations for its R1S and R1T electric vehicles. With the production of each of these models ramping up, Rivian is expected to run into more production issues. However, it plans to produce at least 25,000 vehicles per year in the fourth quarter. Despite the difficulties, Rivian is on track to meet its production goal this year. However, it’s unclear if it’ll be able to meet its production goal by the end of the year.
While Rivian’s production goal of 25,000 electric vehicles per year is ambitious, it has already delivered 1,227 cars to customers. This includes the R1T pickup and R1S sport utility vehicle and commercial EV vans for Amazon. Rivian is not the only company facing production problems in the electric truck market. GM has delayed the Cybertruck until 2023, and Ford has increased the production capacity of the electric F-150 Lightning, which is expected to be on sale in the spring of 2019. Moreover, the company faces stiff competition from GM and Ford, which recently canceled its jointly developing EV project with Amazon.
Despite the challenges of the manufacturing process, the company has ambitious goals for the future of the company. Initially, Rivian’s production goal for 2022 was 50,000 vehicles, but it cut that by half in March. This decision was based on the company’s recent experience with global supply-chain issues. Nevertheless, the new production goal would still help the company meet its goals for the next several years.
Rivian’s aggressive cash burn
As of March 31, Rivian had nearly $17 billion in cash, although it burned $1.5 billion during the first quarter of 2019. With its $5 billion Georgia plant complete and future production plans set in motion, the company should have enough cash to operate for at least three years at its current burn rate. In addition, its new Georgia plant will allow the company to use less expensive manufacturing equipment. With the help of new financing, Rivian may even be able to achieve positive cash flow by 2024.
The company is also facing intense competition, including from Tesla and other incumbent automakers, which have begun investing in EVs. However, the company’s talk of a green future is enough to encourage investors, who are willing to overlook its aggressive cash burn. However, investors should be cautious because this company’s fierce cash burn may not be sustainable. If you’re concerned about Rivian’s cash burn, holding off on purchasing the shares is best until it has a more solid business plan.
Despite the rising costs, the company has maintained its goal of making 25,000 electric vehicles by the end of this year. But analysts have criticized the company’s aggressive cash burn. Operating expenses totaled $1 billion in the first quarter, more than double the $410 million of the previous year. Rivian will report its second-quarter earnings on July 29. In the meantime, investors should pay close attention to the company’s second-quarter earnings report.
Nonetheless, the company’s aggressive cash burn has put the company in an unenviable position. It may have prioritized some ideas over others. As such, the executives of Rivian have a lot to worry about. Rivian’s aggressive cash burn is likely to lead to its decline shortly. However, investors should remember that media reports of acquisition can differ from final agreements.
As a result, the company’s aggressive cash burn has led to a sharp sell-off in its stock. As of March, Rivian has $17 billion in cash. With this capital, the company is well positioned to pursue aggressive growth. The company plans to increase its production capacity to 600,000 vehicles per year. Moreover, the company has a growing order backlog and a factory to build the cars.
Share price forecast for 2025
The price of Rivian stock depends on the company’s fundamentals. By 2025, there are expected to be about 290,000 deliveries of electric vehicles. By 2030, there are expected 701,918 deliveries and $78.7 billion in revenue for the company. Rivian has a lot of potential, but it must accomplish much before its valuation is justified. Therefore, investors should pay attention to the current share price of Rivian.
The stock has lost most of its value this year, but it could start to recover if it can successfully deliver its products on time. While the store is not yet a hot buy, it has some long-term potential due to the increasing adoption of electric vehicles. In addition, the company is getting closer to listing its products and is making strides in delivering them commercially. Rivian beat Tesla in delivery numbers this year, and it is scheduled to begin producing its R1S SUV in December.
A few analysts have also put out a longer-term stock price forecast. However, these are speculative, and there is no way to predict whether Rivian will be able to hit that level. Moreover, making such long-term predictions is difficult, as the EV market is still evolving. Hence, investors should look at the company’s long-term prospects and be prepared to stomach some short-term volatility.
While Rivian has a strong track record of creating electric cars, it has also faced challenges with the regulatory process. Its shares have underperformed expectations, but investors have not been willing to back off their buy recommendations. A recurring revenue stream from software services is expected to generate $10 to $15 per vehicle. If this trend continues, Rivian could see a much higher share price in the coming years.
Rivian is well-positioned to capture a large share of the global EV market as an electric vehicle manufacturer. Rivian also has a substantial order from Amazon for 100,000 electric vans. If the company ramps production quickly, it could become a big EV maker in 10 years. Its recent move into the electric pickup truck segment may also help it capture a portion of the market.
Analyst ratings for Rivian Automotive
Investors who want to get the latest information on a company should consider reviewing analyst ratings. In the last year, Bank of America Co., Barclays PLC, Deutsche Bank Aktiengesellschaft, Morgan Stanley, and Piper Sandler have all issued reports on Rivian Automotive. According to FactSet, these companies have a consensus analyst rating of “Buy,” meaning analysts believe that Rivian Automotive will outperform the market and that investors should add to their current positions.
Despite Rivian’s recent strong revenue growth, the company is still not hitting escape velocity. While the company reported impressive growth in the second quarter, it warned that its losses for the fiscal year 2022 would be significantly more comprehensive than expected. Rivian, based in Irvine, California, has not yet hit its escape velocity and is likely to remain in the industry for the long term. Analyst ratings for Rivian Automotive continue to rise, but investors should be wary of falling stocks showing trouble.
In the fourth quarter, California Public Employees Retirement System increased its stake in Rivian Automotive, Inc. by 39.1%. The investment firm purchased 8,622 shares during the quarter, boosting its stake in the company by 82.5%. Clearstead Advisors LLC also increased its stake in the company by 90.4%, adding 114,076 shares to its portfolio. In addition, several institutional investors purchased shares of Rivian Automotive.
Rivian Automotive is a leading electric vehicle manufacturer. It designs, develops, manufactures, and sells vehicles directly to consumers. It recently launched the R1 platform, a two-row, five-passenger pickup truck with an advanced driver assistance system, digital user interface, and more. Analyst ratings for Rivian Automotive are currently “Buy” and “hold.”
