Rivian Automotive
stock was dropping after the electric-vehicle company posted better-than-expected production numbers. It seems to be a case of “selling the news.” Shares had rallied in advance of the report.
Tuesday, Rivian announced fourth-quarter production of 17,541 units, bringing the full-year total to 57,232 units, better than the company’s recent guidance of 54,000 units provided in November.
The stock, however, was down 8.4% in early trading while the
S&P 500
and
Nasdaq Composite
were down 0.8% and 1.6%, respectively.
Deliveries might be the problem. Production was a record, but Rivian delivered 13,972 units, down from 15,564 delivered in the third quarter. There is typically a gap between production and deliveries for a growing EV producer, but that’s the largest gap in the company’s limited history. Still, it shouldn’t be all that big a deal for shares. All the product Rivian makes is sold. There’s no pile of unsold cars building up.
Overall, production rose about 135% year over year. Deliveries rose to 50,122 units, up almost 150% year over year.
Shares might also be down because they were up a lot heading into the report. Rivian stock added 32% in the month coming into Tuesday trading.
Some of the rise was due to higher expectations for strong production results, some was due to rising expectations for interest-rate cuts in 2024. Lower rates help make EVs more affordable, and they also make it easier to finance startup companies such as Rivian.
Some of that recent gain was coming out of the stock early Tuesday. The results, however, just aren’t bad.
Rivian will report fourth-quarter results on Feb. 21.
Write to Al Root at [email protected]
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