Rivian Automotive (NASDAQ:RIVN) stock is rising after reporting second-quarter deliveries that exceeded expectations and beginning European van deliveries to Amazon (NASDAQ:AMZN).
The electric vehicle (EV) maker delivered 12,640 vehicles from its Illinois factory during the second quarter and produced 13,992. Analysts had expected deliveries of just 11,300 cars and trucks.
In response, shares rose 17.4% in limited trading on July 3, then rose another 7.7% over the holiday weekend. RIVN stock was trading early July 5 at over $21 per share, representing a market cap of nearly $19 billion. For all of 2023 the shares are up 21%. But over the last year, even with the recent gains, it’s down 23%.
Winning Over Skeptics
Rivian was a hot stock at its late 2021 initial public offering (IPO), trading at nearly $130 per share. This was thanks to 2019 backing from Ford Motor (NYSE:F) and Amazon. Ford provided equity, while Amazon took a 20% stake and place an order for 100,000 electric delivery vans to run through the current decade. Deliveries of those vans began in the U.S. last year, with over 3,000 now in use.
Ford sold most of its Rivian stake for a profit last year. It recently owned just 1.12%.
The future of the Amazon relationship came under question recently when the e-commerce giant ordered just 10,000 vehicles for delivery this year. Rivian said it was looking to end its exclusivity agreement on the vans. Amazon called the slowdown just part of its general economizing.
Now, with the delivery of the first Rivian-made Amazon vans in Europe, interest in the stock is rising again. The news follows strong results from Tesla (NASDAQ:TSLA), BYD (OTCMKTS:BYDDF) and Li Auto (NASDAQ:LI), indicating that demand for EVs remains high.
Rivian still hopes to complete a $5 billion plant in Georgia for 2026 production. It has announced a new platform called the R2, with a compact SUV it says will cost just $40,000.
What Happens Next?
The EV market remains a rollercoaster, especially for smaller players. Rivian needs to keep executing its plan or investors could relegate it to the losers’ bin again.
As of this writing, Dana Blankenhorn held a LONG position in AMZN. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
