Rivian Automotive Inc.’s RIVN stock gained more than 24% on Jan. 3 after the upstart electric vehicle (EV) maker released its production and delivery numbers for the fourth quarter and full-year 2024. The company reported that its results aligned with earlier predictions, demonstrating it met its targets despite facing challenges, which impressed Wall Street.
With this sharp increase, investors may be wondering whether it’s still a good time to buy shares of the American automotive manufacturer. Before addressing that question, let’s look at the company’s fundamentals.
RIVN’s Impressive Production & Delivery Figures
Last Friday, Rivian announced that during the December quarter of 2024, it produced 12,727 EVs at its manufacturing facility in Normal, IL, while delivering 14,183 EVs over the same time frame.
Coming to the full-year 2024 numbers, RIVN revealed that it delivered 51,579 vehicles while producing 49,476 units. These results aligned closely with the company’s earlier forecasts, which projected production between 47,000 and 49,000 vehicles and deliveries ranging from 50,500 to 52,000 vehicles.
The announcement was well-received by investors, especially amid rising concerns about overall market demand for EVs. This comes after Tesla Inc. (TSLA) revealed that, for the first time, it experienced a year-over-year decline in the number of EVs it delivered to customers.
RIVN Gains Global Reach, Innovation Boost From Volkswagen JV
Rivian will gain significantly from its joint venture (JV) with Volkswagen VWAGY. The partnership allows Rivian to leverage Volkswagen's global reach and manufacturing expertise, enabling it to scale production and distribution while reducing development costs.
By combining its innovative EV technologies with Volkswagen’s infrastructure, Rivian can bring next-generation EVs to market faster, with plans for new models by 2026, making its products accessible to a wider audience. Additionally, Rivian’s technology will be integrated into future Volkswagen models, expanding its market influence and creating new revenue streams.
Financially, Rivian will benefit from Volkswagen’s investment of up to $5.8 billion by 2027, supporting innovation and expansion. The venture will also enhance Rivian’s automated driving features and over-the-air updates, boosting vehicle value. Collaborating with Volkswagen allows Rivian to accelerate EV adoption globally while maintaining its focus on cutting-edge, high-quality products.
RIVN’s Plans to Expand Beyond Amazon
One of RIVN’s biggest customers is Amazon.com Inc AMZN. In 2024, Rivian started producing and delivering more of these vans to Amazon, as they are part of Amazon's efforts to use cleaner EVs instead of traditional gas-powered ones.
Looking ahead into 2025, Rivian is also trying to sell these electric vans to other companies that operate fleets of delivery vehicles. However, selling to other companies takes time because these businesses often need to adjust their facilities, like installing charging stations and training their teams on how to use and maintain the vans. Despite these challenges, Rivian is optimistic that more companies will start buying their vans as they transition to greener delivery options.
Should You Bet on RIVN?
Rivian's positive developments are also reflected in its three-month price chart, where the stock surged by 57.2%, outpacing the 51% growth of its industry’s composite stocks.
Three-Month Price Chart
Image Source: Zacks Investment Research
Despite this strong momentum, the stock carries notable risks. Rivian remains far from achieving consistent profitability and relies heavily on substantial capital to sustain its operations. Also, the stock has witnessed downward estimate revisions for its bottom line for 2024 and 2025, respectively, over the past 60 days.
Image Source: Zacks Investment Research
Thus, the firm appears to be a high-risk investment that aims to establish itself as a key player in the EV market.
Investors prepared to take on this risk may want to wait for a better entry point, as the stock, carrying a Zacks Rank #3 (Hold), is currently viewed as overvalued. The overvaluation is evident with the stock trading at a trailing 12-month price-to-sales (P/S) ratio of 3.67, which exceeds the industry average of 2.81. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Image Source: Zacks Investment Research
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