2 Reasons to Buy Rivian Stock Before Nov. 6

Core Insights - Rivian Automotive is poised for a significant transformation with the upcoming announcement of earnings in early November, which may present a buying opportunity for investors [1] - The company is expected to provide updates on its affordable models, the R2, R3, and R3X, which are crucial for expanding its market reach [2][4] Group 1: Affordable Models - The introduction of affordable models is essential as a majority of car buyers prefer vehicles priced under $50,000, especially after the elimination of U.S. federal tax credits for EV purchases [3] - Currently, Rivian's existing models are priced at $100,000 or more, limiting its total addressable market, but the new models are anticipated to be priced below $50,000, potentially attracting millions of new buyers [4] Group 2: Growth Potential - Rivian's revenue growth has stagnated over the past 18 months, leading to a decline in its price-to-sales ratio to 3.1, compared to Tesla's ratio of nearly 17, indicating a significant valuation gap that could narrow if the new models perform similarly to Tesla's affordable offerings [5] - The management has confirmed that production of the R2 is set to begin in early 2026, with test vehicles already on the road, suggesting progress towards this goal [6] Group 3: Profitability Challenges - Rivian has not yet achieved net profitability, although it reported positive gross margins for the first time this year, primarily due to sales of automotive regulatory credits, which will be eliminated in 2026 [8][9] - The company experienced a return to negative gross profits in August, raising concerns about its ability to maintain profitability without these credits [9] - Positive developments regarding R2 production could be counterbalanced by potential negative updates on profitability, impacting stock performance [10]