8. Rivian Automotive Inc. (NASDAQ:RIVN)
Number of Hedge Fund Investors: 37
Jim Cramer believes Rivian Automotive Inc. (NASDAQ:RIVN) is a strong long-term investment because its products are impressive. While having a well-funded partner is a positive sign for Rivian Automotive Inc. (NASDAQ:RIVN)’s stability, Cramer advises that this doesn’t automatically mean you should buy the company right now. Instead, he suggests holding onto it rather than selling, as Rivian Automotive Inc. (NASDAQ:RIVN)’s continued presence in the market is a key factor to consider.
” I think Rivian is a great long-term stock. Why? Because the actual product is so fabulous that the last thing I want to do is write these guys off. Now that they have a deep-pocketed partner, does that mean you should own the stock? No. It means that you shouldn’t sell the stock necessarily, but it means the company’s sticking around, and that’s what really matters.”
Rivian Automotive Inc. (NASDAQ:RIVN) is a promising investment due to its successful launch of the R1T electric pickup truck and R1S electric SUV, which have been well-received for their performance and unique features. These vehicles, designed for adventure and outdoor use, give Rivian Automotive Inc. (NASDAQ:RIVN) a strong position in the EV market. Rivian Automotive Inc. (NASDAQ:RIVN) benefits from strategic partnerships, including a significant deal with Amazon.com, Inc. (NASDAQ:AMZN) for 100,000 electric delivery vans and an investment from Ford Motor Company (NYSE:F). These partnerships strengthen Rivian Automotive Inc. (NASDAQ:RIVN)’s market position and financial stability.
Additionally, Rivian Automotive Inc. (NASDAQ:RIVN) is expanding production with its facility in Normal, Illinois, and plans to build a second U.S. factory to meet high demand and boost revenue. Rivian Automotive Inc. (NASDAQ:RIVN)’s early entry into the electric pickup and SUV markets provides a competitive advantage as the global shift toward electric vehicles grows.
Meridian Hedged Equity Fund stated the following regarding Rivian Automotive, Inc. (NASDAQ:RIVN) in its first quarter 2024 investor letter:
“Rivian Automotive, Inc. (NASDAQ:RIVN) is a US-based manufacturer of electric vehicles, namely the R1T pickup truck and R1S SUV. They also have exposure to the commercial vehicle market with their electric delivery vans (EDVs) that are sold to companies like Amazon. The company has faced challenges amid the broader slowdown in electric vehicle demand and rising interest rates.
This has contributed to Rivian underperforming expectations over the past few quarters. Rivian has also incurred losses as it continues to invest in the development of its products and manufacturing capabilities. We own Rivian in a hedged structure, which provides a significant margin of safety. Despite the near[1]term challenges, several factors provide optimism that Rivian can emerge as a long-term winner in the EV market. Rivian’s balance sheet is strong, with a substantial cash position that enables the company to continue investing in its growth and navigate through the current economic headwinds.
Rivian is also unveiling the R2, which is a smaller and more affordable EV platform that will open the company’s products to a wider customer base. Lastly, Rivian’s investment in the enhancement of its production capabilities should improve the company’s manufacturing efficiency and drive a path to profitability. We continue to hold the company in a hedged structure.”
