RIVN - Rivian Is A Key Part Of Amazon's Future
2024-05-12 20:49:39 ET
Summary
- Rivian faces significant challenges from high cash burn and competition from Tesla, yet Amazon's substantial investment and strategic interest may bolster its long-term viability.
- Rivian's alignment with Amazon's sustainability goals and potential growth in the use of Rivian's EVs for Amazon's deliveries underpin the partnership, which means Rivian could thrive over the long term.
- Rivian stock remains a speculative investment at this time, with high levels of uncertainty. Investors should not consider investing a large portion of their portfolio.
I Think Rivian Will Survive
Some analysts have raised concerns that Rivian ( RIVN ) might not survive 2025/2026 due to a high level of cash burn, no profit, and not enough cash on hand to sustain it. These concerns are valid, and there are rising pressures from lower vehicle prices from Tesla ( TSLA ) which are significantly gutting the future potential of other EV makers, most notably unprofitable EV firms like Rivian. I think the near future is going to be incredibly difficult for Rivian, and I believe that management may be wise to take a leaf out of Elon Musk's book by knuckling down further on operational efficiency and lowering costs. Failure to do this significantly could see the firm end up bankrupt in the next few years, depending on whether or not it can successfully raise more debt. If the company closes in on extremely tight cash reserves, equity raising will become less viable due to significantly weakened investor sentiment....
Rivian Is A Key Part Of Amazon's Future