Rivian May Lose Nasdaq 100 Spot After 90% Selloff, JPMorgan Says

[mkg3]

This will piss me off forever. 50k was a random analyst projection made by someone who did not read the IPO documents.

The closest Rivian came to that number was when RJ allued to completing existing preorders by the end of 2022. However if you look at the stated production ramp up (100% factory production rate by the end of 2023) that made no sense. Many people believe he meant Launch editions. The S1 documents did not state the 50k by the end of 22 either.

I wish people would stop spreading this lie.

I do recall that statement made by RJ in the very first earrings call as a public company. It was ambiguous and confusing. I listened to it couple of times to see if any more could have been made clearer - not.

The thing is it's not necessarily the company guidance. As I'd noted in the first post, its the analysts expectations AND the whisper numbers. Take a look at Apple. The company always guide low and analysts always expect a different value - usually much higher. Apple usually meets or beats the expectations, but when they miss and still make their official guidance, the stock price usually tumbles 7~10% lower. .

While S1 is important to IPO, since then, its what is said in the each quarterlies and 10Q filings that updates and reflects the current times that are more important.

So, it's not a lie, but perhaps a misperception. Still, as the cliche goes, perception is reality; hence, managing perception and expectations are extremely important.

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[pricedm]

As usual, specifically JP Morgan, and in general, Wall Street, doesn't know $hit about EVs. The one consistent Wall Street currency with regard to EVs is FUD. No surprise, given their myopic quarterly focus.

 

[mkg3]

Here's a big sales push at the end of the quarter to help boost their revenues. Clearly, the inventory is higher than the demand at the moment.

To me, at least they are trying to get their volume up and that upside may help the stock price initially. The long-term view needs more than a single event.

https://electrek.co/2023/06/09/rivi...normal-il-facility-like-a-normal-car-company/

 

[izgoy]

What kind of valuation should Rivian have when it loses more on each vehicle it sells than the gross proceeds it receives from the sale of each vehicle? This is unsustainable in the short term, not to mention the long term.

I hear the Rivian’s valuation is equal to its assets. That’s what it should be, as there is no path to profitability unless something changes drastically.

 

[Donald Stanfield]

What kind of valuation should Rivian have when it loses more on each vehicle it sells than the gross proceeds it receives from the sale of each vehicle? This is unsustainable in the short term, not to mention the long term.

I hear the Rivian’s valuation is equal to its assets. That’s what it should be, as there is no path to profitability unless something changes drastically.

Someone doesn't understand what the losses are I see. The losses per vehicle doesn't actually mean Rivian is losing that much money per vehicle. It means that total expenses, including ramp up costs and them building their new factory, when figured out as a per vehicle sold number is greater than the profit per vehicle. It does NOT mean the cost to produce each vehicle is more than the sales price.

 

[izgoy]

Someone doesn't understand what the losses are I see. The losses per vehicle doesn't actually mean Rivian is losing that much money per vehicle. It means that total expenses, including ramp up costs and them building their new factory, when figured out as a per vehicle sold number is greater than the profit per vehicle. It does NOT mean the cost to produce each vehicle is more than the sales price.

Costs of building a new factory is not counted as a loss. It’s a capital expense. Common error among fanbois. Tesla fanbois used to came back with this one for years when Tesla had losses.

Do you have a better answer? Like list of itemized losses per vehicle? All I did was quote a well know fact. If you want to refute it, then use real data. Otherwise, move on. There is plenty of content to comment on.

 

[Donald Stanfield]

Expenses on building a new factory is not counted as a loss. It’s a capital expense. Common error among fanbois. Tesla fanbois used to came back with this one for years when Tesla had losses.

Now do ramp up costs.

 

[firstchair]

Unfortunately looks like this was confirmed today. I wonder what the impact will be of what appears to be 4 indexes (Nasdaq-100, Nasdaq-100 ESG index, Nasdaq-100 Equal-Weighted, Nasdaq-100 Ex-Tech Sector) having to sell all their shares and what today's stock price rally means - too little too late?

https://electrek.co/2023/06/13/rivian-rivn-will-lose-spot-nasdaq-100-index/

 

[Riviot]

Unfortunately looks like this was confirmed today. I wonder what the impact will be of what appears to be 4 indexes (Nasdaq-100, Nasdaq-100 ESG index, Nasdaq-100 Equal-Weighted, Nasdaq-100 Ex-Tech Sector) having to sell all their shares and what today's stock price rally means - too little too late?

https://electrek.co/2023/06/13/rivian-rivn-will-lose-spot-nasdaq-100-index/

Up 8+% today

 

[DuoRivians]

This is a non event. The weight of $rivn on ndx 100 is minuscule to be taken off the list, that it won’t move the stock

 

[firstchair]

what today's stock price rally means - too little too late?

https://electrek.co/2023/06/13/rivian-rivn-will-lose-spot-nasdaq-100-index/

Up 8+% today

That's what I was referring to. The question is will it be enough to keep the delisting from happening? Doesn't sound like it unfortunately.

 

[Riviot]

That's what I was referring to. The question is will it be enough to keep the delisting from happening? Doesn't sound like it unfortunately.

 

[Count Orlok]

yawn.

 

[jjswan33]

https://www.barrons.com/articles/rivian-ev-stock-nasdaq-100-lucid-977e078d

[Full Text]

Rivian, Lucid Out of The Nasdaq 100? It Won’t Hurt the Stock.


R ivian Automotive and Lucid Group investors face another headache. This one shouldn’t require aspirin.


Rivian stock (ticker: RIVN) is leaving the Nasdaq 100, an index of the largest, non-financial companies that trade on the Nasdaq stock exchange, and is being replaced by ON Semiconductor stock (ON), effective June 20.


Criteria for being included in the index are mainly based on market capitalization, although there are some other considerations such as trading volumes.


Rivian’s market capitalization has crumbled about 66% from early 2022 to about $14 billion. ON Semi’s market capitalization has surged about 50% over that same time frame to about $40 billion.


Indexation can matter to a stock, creating a steady base of buyers among the funds that track said index. Being left out of the Nasdaq 100, however, shouldn’t be too big a headwind for Rivian stock. The amount of money funds invest to track the Nasdaq 100 appears to be in the hundreds of billions of dollars. That’s nothing to sniff at, but the amount of money indexed to or benchmarked against the S&P 500 is roughly $16 trillion. S&P 500 indexation generates far more buying and selling.


Eventually, of course, the value of any company’s stock is a function of the earnings and cash flow a company generates. Still, valuations and the number of people watching a stock, which is reflected in liquidity, matter.


Rivian isn’t an S&P 500 component, and isn’t likely to become one soon. Candidates for that index have to demonstrate consistent profitability, for starters.


Nasdaq didn’t immediately respond to a request for comment about the amount of money indexed to the Nasdaq 100. Rivian declined to comment on its removal from the index.


Lucid stock (LCID) is in the Nasdaq 100, and it may be in the same boat as Rivian. Lucid’s market capitalization is about $13 billion, and its stock has tumbled roughly 75% since early 2022.


Ramping up production has been harder than expected for both companies. What’s more, there is more EV competition as more models enter the market. And rising interest rates have sapped some investor enthusiasm for companies that need external financing to grow their businesses.


Production, demand, capital, and competition are much bigger deals for both stocks than the Nasdaq 100. That will remain the case in the coming weeks.


Write to Al Root at [email protected]

 

[firstchair]

https://www.barrons.com/articles/rivian-ev-stock-nasdaq-100-lucid-977e078d

Paywalled. Anything good?

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