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The Reasons Behind Rivian Automotive Stock’s Boom And Bust

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Rivian Automotive
FILE PHOTO: Rivian Automotive Inc facility in California·Reuters

(CTN News) – Throughout the early hours of trading on the Nasdaq this morning, Rivian Automotive (RIVN -0.77%) witnessed a substantial surge of nearly 8% in its stock price. Pleasure is present!

The stock of the company subsequently started to decline, recouping the majority of its gains; as of 10:30 a.m. Eastern Time, the stock had risen by a mere 1.6%. What a cry!

When did Rivian’s stock price increase, and when did it subsequently decline once more? The solution can be succinctly stated as Apple (AAPL 0.38%), a single word.

What’s better than Rivian’s rivalry with Apple? Is Detroit on your list?

The subsequent details pertain to the electric vehicle manufacturer Rivian Automotive and the technology behemoth Apple: Apple has reportedly been “exploring collaboration” with Rivian, according to a DigiTimes Asia report published today. One challenge associated with this narrative is that it primarily relies on sources situated within the supply channels of the companies in question, rather than direct correspondence from Apple or Rivian. Furthermore, it appears that the purported “collaboration” may be limited to Rivian’s integration of Apple CarPlay technology into its lineup of electric vehicles and vans.

That is in stark contrast to, say, Apple providing Rivian with a substantial financial investment in lieu of developing its own electric vehicle (a project that has since been abandoned) or Apple deciding to acquire Rivian in its entirety (another unfounded speculation from earlier this year). MacRumors.com ultimately concludes that this most recent speculation should be regarded as “extremely speculative.”

Is it prudent to purchase Rivian Automotive stock?

Consequently, it is highly advisable to disregard this specific rumor, which, in actuality, investors seem to be doing at the present despite their initial enthusiasm for it.

This means that Rivian Automotive shareholders are left with exactly the same shares that they held the day before: a company which has a net cash burn of approximately $6 billion annually in spite of having less than $4.5 billion in net cash on its balance sheet. In the event that the company remains in business until 2026, then the new R2 electric SUV will be introduced, and that is if the company continues to operate until then. Furthermore, a particular corporation has recently declared that the sales of the electric vehicles it does offer for sale will experience an exact zero percent increase this year.

It does not strike me as a particularly robust growth stock; therefore, you may disregard my skepticism.

At this time, would it be advisable for you to invest $1,000 in Rivian Automotive?

Consider the following factors prior to making an investment in Rivian Automotive stock:

The analysis team at Motley Fool Stock Advisor has just concluded a process in which they identified ten equities that they believe are currently the most favorable for investors to acquire. Moreover, Rivian Automotive did not fall into that category. It is conceivable that the ten selected equities could yield substantial returns in the coming years.

Considering the inclusion of Nvidia on this list on April 15, 2005, an initial investment of $1,000 at the time of our recommendation would have yielded $564,547, correct?

It is critical to highlight that Stock Advisor has generated an average annual return of 666%, which significantly outperforms the S&P 500’s 151% annual return. Ensure that you review the most recent compilation of the top ten.

SEE ALSO:

Layoffs At Tesla Superchargers Could Hurt EVs In America

Salman Ahmad is a seasoned writer for CTN News, bringing a wealth of experience and expertise to the platform. With a knack for concise yet impactful storytelling, he crafts articles that captivate readers and provide valuable insights. Ahmad's writing style strikes a balance between casual and professional, making complex topics accessible without compromising depth.

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