Rivian stock price has remained in a two-year consolidation phase as investors focus on its cash burn and the evolution of the electric vehicle industry. RIVN was trading at $14 on Monday, higher than last year’s low of $8.70. It remains over 90% below its all-time high. So, is the RIVN stock price a bargain or a value trap?
Rivian stock price analysis: RIVN is at crossroads
The weekly chart shows that the RIVN share price peaked at $180 after going public in 2021. That performance made it a bigger company than popular EV firms like Ford and General Motors, combined.
The stock then crashed and bottomed at an all-time low of $8.70 as concerns about the EV industry jumped. Most companies in the EV industry crashed at the time.
Rivian stock price has now formed what looks like an ascending triangle pattern, one of the most bearish signs in the market. This pattern is made up of a strong horizontal bottom and a descending trendline. In this case, the trendline connects the highest swings since July 2023.
The stock remains below the 50-week and 25-week Exponential Moving Averages (EMA), a sign that bears are in control. Therefore, the stock will likely have a strong bearish breakdown unless bulls push it above the descending trendline.
A bearish breakdown may see the stock crash below the lower side of the triangle to the support at $5. On the other hand, a strong bullish breakout above the descending triangle would be a bullish sign, with the next potential target being at $29, up by 110% above the current level.
Rivian stock price chart | Source TradingView
RIVN earnings ahead
The Rivian stock price will be in the spotlight this week as the company publishes its financial results on February 20th.
The most recent results showed that the Rivian revenues rose to $874 million in the third quarter as it delivered 10,018 vehicles. Its gross loss stood at about $392 million, an improvement from the $477 million it lost a year earlier.
Fortunately, Rivian has made a lot of progress as it positions itself for the future. It has purposed to turn a small gross profit in the fourth quarter of last year, a positive move since it has a long history of burning cash.
The company has also boosted its balance sheet by raising cash from Volkswagen Group, the giant German company. It created a joint venture that will see the two companies partner on technology and other areas. Rivian also received funds from the Department of Energy in January.
Rivian ended the third quarter with about $6.4 billion in cash and short-term investments, a figure that has likely gone up because of the Volkswagen investment.
Analysts polled by Reuters expect the results to show that its revenue rose by 8.43% to $1.43 billion in the fourth quarter. If accurate, these numbers will bring the annual figure to $4.68 billion, a 5.45% annual increase. It will then hit $5.17 billion in the current financial year.
The other potential catalyst for Rivian is that its users love its vehicles. It has become the most popular electric truck in the United States, a move that
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