Is Rivian Stock a Buy Before Feb. 20?

Core Viewpoint - Rivian Automotive has faced significant challenges, including a 90% decline in stock value since its public market debut in 2022, despite positive product reception and awards. The company is struggling with slow growth and high cash burn [1][2]. Group 1: Gross Profitability - Rivian's CEO has expressed optimism for a "modest" gross profit in Q4 2024, driven by lower material costs and increased sales of green car credits, which can be sold to other automakers [3]. - Achieving gross profit in Q4 2024 would mark a significant improvement from Q4 2023, where the company lost approximately $124,162 per vehicle sold, totaling around$1 billion [4]. Group 2: Growth Acceleration - Rivian needs to demonstrate top-line growth, which is currently lacking, as it delivered only 14,183 vehicles in Q4, reflecting a mere 1.5% increase year-over-year [6]. - Unlike established automakers, Rivian's inability to scale into a sustainable business model poses a risk, especially as reliance on selling regulatory credits may not be viable long-term [7]. Group 3: New Products and Partnerships - The introduction of new products based on Rivian's mid-sized vehicle platform, including the R2 model expected in 2026 at a price point of $45,000, is crucial for growth [8]. - Rivian's recent$5.8 billion joint venture with Volkswagen aims to enhance software and electronics in vehicles, providing essential cash flow and potential economies of scale [9]. - As of September, Rivian had $6.74 billion in cash against a quarterly operating loss of approximately$1.17 billion, highlighting the need for strategic partnerships to ensure survival until new models are launched [10][11].