Rivian Stock Higher As 2022 Production Hopes Offset Wider $5.45 Billion Loss Forecast

Rivian Automotive  (RIVN)  shares edged higher after the upstart electric truckmaker forecast a wider-than-expected 2022 loss but stuck to its forecast of producing 25,000 vehicles by the end of the year.

The stock also found support from a number of analysts upgrades, with price target boosts from RBC, D.A. Davidson and Wells Fargo, as investors look through near-term supply chain disruptions and focus on the group’s improving pre-order backlog.

Rivian, which is hoping to ramp-up production in the coming years to challenge established rivals such as Tesla  (TSLA)  in the global EV market, said its first-half production tally came in just under 7,000 after delivering 4,467 over the three months ending in June. The Amazon AMZN-backed group generated revenues of $364 million and a second quarter loss of $1.71 billion.

That figure will widen to $5.45 billion by the end of the year, Rivian said, wider than its prior projection of $4.75 billion, even with 98,000 unfilled pre-orders for its pickup trucks and unsold inventory of around $655 million.

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“The supply chain continues to be the limiting factor in our production rates but we remain confident in our ability to achieve our target,” CFO Claire McDonough told investors on a conference call late Thursday. “On the delivery side, in July, we started a larger effort to move from truck to rail for our outbound freight, which should provide additional cost savings as we scale our operations.”

Rivian shares were marked 0.23% higher in pre-market trading to indicate a Thursday opening bell price of $39.04 each, a move that would still leave the stock nursing a six-month decline of around 37.7%.

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