[RITVT]

Is it overvalued?

Or, is it a bet on the future, cleaner energy, smarter vehicles, home-owners with solar arrays, EV incentives for consumers, a moralistic perspective on the future for our kids, etc.

Buying RIVN is a bet that Fleets shouldn't run on gas. It's a bet that RIVN sells more fleet vehicles outside AMZN. It's a bet that younger generations won't buy ICE vehicles. It's bet that companies will benefit through first mover advantages if they have an environmentally responsible code of ethics, its a bet that the cost of EV's will come down, it's a bet on Moore's law regarding the pace of EV production, its a bet that there will be a super charger infrastructure, its a bet on cultural awareness, and its a bet on something bigger and potentially better than TESLA, so it might all make a lot of sense, but its a lot of betting. Glad to make the bet, and I did that with the DSP & IPO.

 

[NY_Rob]

It's a pure EV manufacturer based in good ol' USA. EV investments are in/now/happening and everyone wants a share (literally ) in their portfolio. Look at Tesla, with that in mind, unless Rivian completely screws the pooch somehow.. the sky's the limit for the stock IMO.

 

[Eticket99]

Just wait till May 5th when the 180-day lockup period ends... I predict HUGE blocks selling and the price falling by easily 50% if its above $150+ at that time, so many people will be looking to take a lot of cash off the table.

 

[RITVT]

Just wait till May 5th when the 180-day lockup period ends... I predict HUGE blocks selling and the price falling by easily 50% if its above $150+ at that time

Buy on the dip people.

 

[Eticket99]

Buy on the dip people.

Not a whole lot of dip

 

[RITVT]

I was referring to the above prediction... If that really happens, I will buy more. For now, I'm enjoying no dip.

 

[LindsayH]

Buy on the dip people.

You'd have to imagine that any dip - even 50% - on May 5th would be a dip on a further inflated stock price, no? Potentially even bringing it back down to a price close to where we're already at today. I don't have a clue on trading, and wasn't even "smart" enough to buy my full allocation on the DSP, but I'm not seeing a likelihood of a dip back to < 100 at this point (aside from a corporate catastrophe or an entire market slump). Everyone's looking for the Tesla-esque growth spurt right? So where was this Tesla dip that folks should've held out for? I don't see it. I feel like different rules apply to these tech meme stocks.

Again, I'm punching above my weight talking about trading. Just partaking in some friendly discord as I see it. I'm not bold enough to take any huge leaps on this myself, so I'll stick with zero maintenance index trackers and let the roboinvestors take care of my money.

 

[ZeApelido]

Valuation is about future expected profits discounted back to present day value. It's certainly ok for Rivian to be valued based on future profits, but are they?

Tesla, for example, is trading at ~ 130 P/E ratio with last quarters non-GAAP earnings annualized. With production and revenue growth going up 50% next year, P/E ratio would drop under $100 next year if share price remained around $1000 (compared to marketwide PE ratio of ~ 30).

The main problem with Rivian valuation is that they say they want to make 1 million vehicles per year by 2030. Let's assume a generous $10,000 of profit per vehicle, and P/E ratio of 50, that would give RIVN a market value of 500 billion and share value of $589 in 2030. Discount back with a 10% discount rate, that gives you around a $250 share price.

But because that valuation is so dependent on the far future and the assumption of how much profit per vehicle they will make, any changes in perception to the probability of that profit happening will make the stock very volatile. When earnings are reported, there is a good chance of a correction.

Personally I followed and invested in Tesla in their volatile years, and they weren't valued nearly to the level of Rivian when at similar stages. That offered a better reward/risk than Rivian now. Rivian can probably only return a 2x or 3x from current levels over 5 years. If / when Rivian drops below $80 a share, I will consider investing.

 

[SANZCO2]

Valuation is about future expected profits discounted back to present day value. It's certainly ok for Rivian to be valued based on future profits, but are they?

Tesla, for example, is trading at ~ 130 P/E ratio with last quarters non-GAAP earnings annualized. With production and revenue growth going up 50% next year, P/E ratio would drop under $100 next year if share price remained around $1000 (compared to marketwide PE ratio of ~ 30).

The main problem with Rivian valuation is that they say they want to make 1 million vehicles per year by 2030. Let's assume a generous $10,000 of profit per vehicle, and P/E ratio of 50, that would give RIVN a market value of 500 billion and share value of $589 in 2030. Discount back with a 10% discount rate, that gives you around a $250 share price.

But because that valuation is so dependent on the far future and the assumption of how much profit per vehicle they will make, any changes in perception to the probability of that profit happening will make the stock very volatile. When earnings are reported, there is a good chance of a correction.

Personally I followed and invested in Tesla in their volatile years, and they weren't valued nearly to the level of Rivian when at similar stages. That offered a better reward/risk than Rivian now. Rivian can probably only return a 2x or 3x from current levels over 5 years. If / when Rivian drops below $80 a share, I will consider investing.

Where are you getting Tesla’s PE Of 130? Everywhere I see it is in the stratosphere at 340ish, More than 15 times other car companies.

 

[RivianDoc]

I was referring to the above prediction... If that really happens, I will buy more. For now, I'm enjoying no dip.

Amen!

 

[ZeApelido]

Where are you getting Tesla’s PE Of 130? Everywhere I see it is in the stratosphere at 340ish, More than 15 times other car companies.

The 340 is based of the "trailing twelve months" EPS metric of summing the last 4 quarters earnings. This is not really giving a realistic picture of earnings generation happening right now (I took Q3 earnings x 4 instead).

In Q4 earnings in January, Tesla will likely report an EPS greater than $2 per share. It will proceed to grow for a few years at least so I expect share price to stay above a 100 P/E ratio in that time.

 

[Eticket99]

Its going to be a wild ride (thing moves like crypto, yo yo 15-20% swings, great for day traders). I think there might be an opportunity to get under $100 again (because I'd sure like to get some), case in point they'll have to start giving quarterly updates on production, and if they continue to miss their mark, market sentiment won't continue to be so positive, add in the lock up ending in May, could have a recipe for some dips to gobble up some decently priced shares.

 

[doozenberg]

You'd have to imagine that any dip - even 50% - on May 5th would be a dip on a further inflated stock price, no? Potentially even bringing it back down to a price close to where we're already at today. I don't have a clue on trading, and wasn't even "smart" enough to buy my full allocation on the DSP, but I'm not seeing a likelihood of a dip back to < 100 at this point (aside from a corporate catastrophe or an entire market slump). Everyone's looking for the Tesla-esque growth spurt right? So where was this Tesla dip that folks should've held out for? I don't see it. I feel like different rules apply to these tech meme stocks.

View attachment 3867

Again, I'm punching above my weight talking about trading. Just partaking in some friendly discord as I see it. I'm not bold enough to take any huge leaps on this myself, so I'll stick with zero maintenance index trackers and let the roboinvestors take care of my money.

Ah how short memories are. If you zoom into that stock graph you’ll see massive volatility in Tesla stock pre 2018. Plenty of dips pre split. Just harder to see since their recent meteoric rise. Tesla almost died a few times and pundits were not favorable in the early days. Rivian will see similar near term volatility as shiny IPO status wears off and people realize how hard it is to actually mass produce trucks as they experience quarter after quarter of massive losses. Just wait. It is coming people

 

[IntimidatorTJ]

As I'm writing this post Rivian stock is sitting at $158.53. Which is pretty remarkable in the span of a week.

With the way things have been going does anyone think the stock is over bought? Or is this something that we should expect?

100% it is overvalued. It may take a while for the stock market to adjust the price to "reality", but it will.

In a year, it is okay to call me out if I am wrong.

PS When is my Rivian going to be delivered?!

 

[Wing]

I knew I should have held off, I felt it was overvalued at 100. But it kept climbing and climbing so bought in at 140. Probably should have taken those gains at 170.

Now it's 110 and I think it will drop even more. I'll buy some more when it goes even further to average down I guess.

 

[Eticket99]

I knew I should have held off, I felt it was overvalued at 100. But it kept climbing and climbing so bought in at 140. Probably should have taken those gains at 170.

Now it's 110 and I think it will drop even more. I'll buy some more when it goes even further to average down I guess.

Yeah you'll be able to AVG down decently as its pulling back hard now, but long term should be fine. Hoping to jump in a little under $100 if given the chance, but might just wait till that lock-up ends, if its sub $150 by then it's going to be a great price to get in around then.

 

[IntimidatorTJ]

I knew I should have held off, I felt it was overvalued at 100. But it kept climbing and climbing so bought in at 140. Probably should have taken those gains at 170.

Now it's 110 and I think it will drop even more. I'll buy some more when it goes even further to average down I guess.

IPO are tough calls. Valuations get out of whack, then investors start to sell and the price begins to drop to a lower valuation.

The stock could even fall below $78 bucks a share over the next few months. Right now Rivian STOCK is not an investment. It is purely rolling the dice.

 

[ZeApelido]

Valuation is about future expected profits discounted back to present day value. It's certainly ok for Rivian to be valued based on future profits, but are they?

Tesla, for example, is trading at ~ 130 P/E ratio with last quarters non-GAAP earnings annualized. With production and revenue growth going up 50% next year, P/E ratio would drop under $100 next year if share price remained around $1000 (compared to marketwide PE ratio of ~ 30).

The main problem with Rivian valuation is that they say they want to make 1 million vehicles per year by 2030. Let's assume a generous $10,000 of profit per vehicle, and P/E ratio of 50, that would give RIVN a market value of 500 billion and share value of $589 in 2030. Discount back with a 10% discount rate, that gives you around a $250 share price.

But because that valuation is so dependent on the far future and the assumption of how much profit per vehicle they will make, any changes in perception to the probability of that profit happening will make the stock very volatile. When earnings are reported, there is a good chance of a correction.

Personally I followed and invested in Tesla in their volatile years, and they weren't valued nearly to the level of Rivian when at similar stages. That offered a better reward/risk than Rivian now. Rivian can probably only return a 2x or 3x from current levels over 5 years. If / when Rivian drops below $80 a share, I will consider investing.

Getting to be a better value under $90, but I think there is more pain to come first.

 

[IntimidatorTJ]

Getting to be a better value under $90, but I think there is more pain to come first.

Agreed. Feel bad for anyone that bought the stock at $150-170. It may never get back to that price because investors might actually look at the valuation.

It won't help if the the stock market in general swoops down.
Nor if Rivian can't do better in 2022 delivering vehicles. They really need to show by the end of 2022 that they did deliver a fair # of R1T and R1S or investors will push the price lower. Rivian bought the factory in 2017 and took deposits starting in 2018. Wall Street expects some level of ability after that length of time.