Rivian's Growth Story Screeches To A Halt

Core Viewpoint - Rivian Automotive, Inc. is facing significant challenges, including high cash burn, declining market share, and overvaluation, which make it a risky investment despite recent stock price increases. Group 1: Financial Performance - Rivian's vehicle deliveries grew only 3% year-over-year from 50,122 in 2023 to 51,579 in 2024, indicating slowing growth [4] - The company produced 14,611 and delivered 8,640 vehicles in Q1 2025, exceeding previous guidance [5] - Rivian's total operating costs were 229% of revenue in 2023 and 194% in 2024, leading to substantial losses [16] Group 2: Market Position - Rivian's U.S. market share peaked at 5.0% in Q3 2023 but fell to 2.9% in Q1 2025, reflecting a loss of competitive edge [9] - The company’s deliveries in Q1 2025 dropped 37% year-over-year from 13,588 in Q1 2024 to 8,553 [8] Group 3: Cash Burn and Valuation - Since 2020, Rivian has burned $32.5 billion in free cash flow, which is 159% of its enterprise value [12] - Rivian's current stock price of $14 implies it must generate $124.4 billion in revenue by 2035, which is highly unlikely given industry competition [23][25] - The company has an economic book value of -$39 per share, suggesting that equity investors may not see any economic earnings under normal operations [33] Group 4: Investment Risks - Rivian's interest coverage ratio is currently -13.6, indicating severe financial strain [13] - The company is classified as a "Zombie Stock," with a cash burn rate that could lead to bankruptcy without further investment [10][11]