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Rivian (RIVN) Incurs Q3 Loss, Announces Scaling-Up Efforts

Rivian (RIVN) reports a net loss in Q3 and sees a bleak production in the coming months with an expected shortage of "a few hundred vehicles" from its 2021 target...

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This story originally appeared on Zacks

Rivian Automotive RIVN released third-quarter 2021 results yesterday, which marked the company’s first quarterly release since it went public last month. The electric vehicle (EV) start-up incurred a net loss of $1.23 billion in the third quarter, well within its previously announced expected range of $1.21 billion to $1.28 billion. Loss per share came in at $12.21 on revenues of $1 million.

Shares of Rivian plunged 10% in after-hours trading on Dec 16, following the company’s lowering of vehicle production expectations for the year despite reporting a surge in customer reservations.

The company stated that it sees a bleak production in the coming months with an expected shortage of “a few hundred vehicles” from its 2021 target of 1,200 vehicles. Impediments to the supply chain, coupled with challenges in hoisting production of the complex batteries required to power the vehicles, are expected to hurt production. However, Rivian doesn’t anticipate long-term challenges in its ramping efforts.

Notwithstanding production snags, the total reservations for its electric R1T pickup and R1S SUV increased to 71,000 as of Dec 15, 2021, rising 28% from 55,400 vehicles in November. It has also produced 652 R1T and R1S vehicles and delivered 386 of the same, including the production and sale of the first two R1S SUVs earlier this week.

Rivian also looks to actualize the expansion of its manufacturing operations with its second U.S. plant in Atlanta, GA. It is planning for a vehicle assembly and battery plant located in a carbon-conscious campus in Morgan, Atlanta and Walton Counties. With an investment of $5 billion, the Georgia plant will have an annual production capacity of 400,000 vehicles. Construction is expected to commence in the summer of 2022, with production scheduled for 2024. The sprawling campus will boast dedicated community engagement and workforce training programs.

The company is optimistic that the plant will be an impetus to its bold efforts in scaling up business in Georgia. It is also augmenting capacity at its plant in Normal, IL, with plans to increase the workforce by the second quarter of 2022.

With a number of projects underway, Rivian is working with an aggressive footing toward building next-generation products.

- Zacks

Zacks Rank & Key Picks

Rivian currently carries a Zacks Rank #3 (Hold).

Better-ranked peers in the same space include Goodyear GT, flaunting a Zacks Rank #1 (Strong Buy) and Genuine Parts GPC and Dorman Products DORM, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Goodyear has an expected earnings growth rate of 197% for the current year. The Zacks Consensus Estimate for earnings for the current year has been revised 77% upward over the past 60 days.

Goodyear beat the Zacks Consensus Estimate for earnings in all the four trailing quarters. The company pulled off a trailing four-quarter earnings surprise of roughly 228.5%, on average. Its shares have also gained around 88.8% over a year.

Genuine Parts has an expected earnings growth rate of 27.3% for the current year. The Zacks Consensus Estimate for the current year has been revised around 5% upward over the past 60 days.

Genuine Parts beat the Zacks Consensus Estimate for earnings in all the four trailing quarters. The company delivered a trailing four-quarter earnings surprise of roughly 16%, on average. Its shares have rallied around 39.5% over a year.

Dorman has an expected earnings growth rate of 36% for the current year. The Zacks Consensus Estimate for the current year has been revised 2% upward over the past 60 days.

Dorman beat the Zacks Consensus Estimate for earnings in all of the four trailing quarters. The company pulled off a trailing four-quarter earnings surprise of roughly 10.41%, on average. Its shares have also rallied around 20.7% over a year.



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