Is Rivian Stock a Buy on the Dip?

It's been a volatile commencement to the twelvemonth for Rivian Automotive (NASDAQ: RIVN), and that signifier continued aft the banal terms fell pursuing its Q1 results merchandise aft the doorbell connected April 30. The banal is present down much than 25% twelvemonth to date, arsenic of this writing.

Let's dive into the electrical conveyance (EV) maker's results and prospects to spot if investors should bargain the dip successful the stock.

The roadmap to profitability

In Q1, Rivian saw gross emergence 11% twelvemonth implicit twelvemonth to $1.4 billion, portion deliveries jumped 20% to 10,365 vehicles. Nearly fractional of its gross came from Electric Delivery Van deliveries to Amazon.

Automobile gross fell by 2% twelvemonth implicit twelvemonth to $908 million, portion bundle and work gross surged 49% to $473 million. Approximately 60% of its bundle and work gross came from its associated task with Volkswagen. It volition rotation retired point-to-point driving capabilities by the extremity of this year, including Uber Technologies' robotaxi pilots with information drivers successful Miami and San Francisco. It is looking for afloat autonomous robotaxis by 2028.

Rivian recorded a gross nett of $119 million, bully for a 9% gross borderline helped by its high-margin bundle business. While automotive gross margins were negative, it expects to inactive execute "healthy" gross margins erstwhile its caller R2 SUV scales up. Its adjusted EBITDA nonaccomplishment widened from $329 cardinal a twelvemonth earlier to $472 million. Meanwhile, it had escaped currency outflows of $1.08 cardinal successful the quarter, compared to $526 cardinal a twelvemonth ago.

Looking ahead, the institution kept its guidance unchanged. It inactive expects to grounds betwixt $2.1 cardinal and $1.8 cardinal successful antagonistic adjusted EBITDA, portion spending betwixt $1.95 cardinal and $2.05 cardinal successful superior expenditures (capex). It is besides inactive looking to present betwixt 62,000 and 67,000 vehicles contempt its mill being damaged by a tornado.

It besides announced that Volkswagen successfully tested its zonal architecture successful wintertime weather, triggering different $1 cardinal equity investment. On apical of that investment, which it conscionable received, it expects to get different $1 cardinal from Volkswagen and $550 cardinal from Uber this year.

Is Rivian a bargain connected the dip?

Rivian remains a speculative stock, but it surely has immoderate breathtaking developments with the rollout of its caller R2 conveyance and its propulsion into autonomous driving. The R2 could beryllium a crippled changer, arsenic its little terms constituent gives it a overmuch wider audience, which should not lone thrust gross maturation but besides dispersed much fixed costs per vehicle, helping thrust gross margins. Meanwhile, it's not readying to physique a robotaxi; it's conscionable offering autonomous-driving software, making this a high-margin opportunity.