Is Rivian Inventory a Purchase Now?

August 25, 2025 icemelon17@gmail.com

Rivian Automotive is constructing an electrical car start-up from the bottom up.
It is targeted on enhancing its profitability as it really works to deliver out a lower-cost mannequin.
The corporate’s newest steerage highlights that the enterprise continues to be within the early phases.
10 shares we like higher than Rivian Automotive ›

Rivian Automotive (NASDAQ: RIVN) is an electrical car start-up making an attempt to make use of new expertise as a method to break right into a mature and extremely aggressive {industry}. That could be a tall order, but it surely has been finished earlier than, with Tesla displaying that it’s certainly potential.

However it’s also potential that Rivian may fall wanting its aim, as many upstart electrical car (EV) firms have additionally finished. So, the massive query is: Is the inventory value shopping for now?

At its core, Rivian is an industrial enterprise constructed round manufacturing extremely complicated and costly merchandise. Creating such a enterprise from the bottom up may be very time-consuming and really costly, which helps to elucidate why Rivian is bleeding pink ink immediately. And it’s extremely prone to hold posting losses for years to come back. In case you are a conservative investor, you’ll most likely need to keep away from Rivian inventory.

An unhappy driver sits in a car. — Picture supply: Getty Photos.

Nonetheless, there’s an fascinating twist right here. Tesla mainly created the EV house, proving to the established automakers that there was an actual enterprise in what had beforehand been thought-about simply an fanatic’s area of interest. Tesla introduced in new expertise that disrupted the previous method of doing issues. Rivian is making an attempt to trip on Tesla’s coattails to interrupt into the auto {industry}, too.

Like Tesla, Rivian has began out with a high-end mannequin. And like Tesla, it’s now engaged on bringing out a lower-priced possibility for the mass market. The corporate has switched from specializing in rising quantity to a concentrate on turning a revenue. And it has made sturdy progress, having hit its goal of producing a modest gross revenue within the remaining quarter of 2024. It repeated the feat within the first quarter of 2025 however fell quick within the second quarter of the 12 months.

A gross revenue just isn’t the identical as producing optimistic earnings. A gross revenue simply implies that Rivian offered every automobile for greater than the automobile value to supply. There are different prices additional down the earnings assertion that may proceed to maintain it from entering into the black.

The corporate is a start-up, in order that’s to be anticipated. What’s necessary is that it hits its inside targets and, to this point, it has finished a superb job of that. And this success has allowed Rivian to companion with industry-leading firms like Volkswagen and Amazon and appeal to ample progress capital.

However the change in administrations in Washington has shifted the enjoying subject. The once-generous authorities assist for EVs has turn out to be much less so. And Rivian has up to date its full-year forecast for earnings earlier than curiosity, taxes, depreciation, and amortization (EBITDA) in a downward path. That is not good, however it’s the form of factor that occurs once in a while.

The corporate continues to concentrate on what it may management, which proper now’s execution. The following huge aim is bringing out a lower-priced mannequin, seemingly in 2026, that may assist it attain mass-market clients.

Mainly, Rivian has loads of money on its steadiness sheet (over $7 billion) to assist its enterprise and is making regular progress because it builds out that enterprise. It’s not a low-risk funding, however for more-aggressive buyers, it’d nonetheless be value a more in-depth look. If Rivian can obtain even half the success that Tesla has, the longer term might be very shiny for the inventory.

Though a few of Rivian’s upstart EV friends have fallen by the wayside, it continues to maneuver ahead. The corporate’s execution has been excellent, and that implies {that a} optimistic end result seems more and more potential.

However it’s nonetheless a money-losing start-up, so there may be all the time the danger that it, too, falls by the wayside — which is why solely aggressive long-term buyers must be it. The upside might be big, however you could perceive the dangers you take for those who purchase an organization that’s nonetheless within the early phases of its growth.

Before you purchase inventory in Rivian Automotive, contemplate this:

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Reuben Gregg Brewer has no place in any of the shares talked about. The Motley Idiot has positions in and recommends Amazon and Tesla. The Motley Idiot has a disclosure coverage.

Is Rivian Inventory a Purchase Now? was initially printed by The Motley Idiot

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