Rivian Automotive Inc

Rivian stock fell 12.3% in July after the electric vehicle company sold more than 75 million new shares at $15.50 per share, raising about $1.2 billion. The sale, which also includes an option for underwriters to purchase an additional 11.25 million shares, will fund general corporate purposes and equity contributions toward a U.S. Department of Energy loan. Investors reacted negatively to the dilution and the underlying cash burn, as Rivian’s 2026 capital expenditures are projected at $1.7 billion to $1.8 billion while it ramps up production of the lower-priced R2 vehicle. The company did report a second-quarter gross profit of $179 million, up from a $206 million loss a year earlier, and lowered its full-year spending guidance by $250 million at the midpoint. However, broader skepticism about EV demand and a consumer shift toward hybrids continue to weigh on the stock.

Morgan Stanley raised its Rivian price target to $14 from $13 but maintained an underweight rating, even after the electric-vehicle maker reported second-quarter revenue of $1.658 billion and a $179 million gross profit. The firm splits its target into $8 a share for the auto business and $6 for software and services, reflecting a bet on future data monetization. Rivian shares fell more than 9% to $15.22 on Friday as investors focused on a $1.3 billion equity sale and rising component costs that threaten margins during the R2 production ramp. The company raised full-year delivery guidance to a range of 65,000 to 70,000 vehicles and trimmed planned capital spending by $250 million at the midpoint. Morgan Stanley is watching whether Rivian can launch point-to-point autonomy in select markets by year-end and whether the R2 can achieve positive gross margin as cheaper trims arrive in 2027.

Rivian CEO RJ Scaringe said Chinese electric-vehicle manufacturers are hard to compete against because their capital cost is often zero, provided by local governments. Speaking on the automaker's second-quarter earnings call, Scaringe noted that while manufacturing approaches are similar, China enjoys much lower labor costs and a cost-of-capital advantage that dramatically reduces production expenses. He added that in a world of completely open trade, Rivian would optimize around the lowest input costs, but under current conditions the company believes certain components should be sourced from the United States. Rivian also disclosed a $250 million investment from Uber as part of a partnership targeting fully autonomous robotaxis by 2028, with Level 3 eyes-off driving planned for 2027. The company reported second-quarter revenue of $1.66 billion, up 27% year-over-year and above the $1.51 billion consensus, with a narrower-than-expected loss of 63 cents per share.

Rivian Automotive shares fell 9.57% to $15.22 on Friday despite reporting second-quarter revenue of $1.66 billion, which exceeded the estimated $1.51 billion. Investors focused on profitability concerns and broader electric vehicle market pressure, with trading volume reaching 53.9 million shares, about 52% above the three-month average. The company recently raised its 2026 vehicle delivery guidance to a range of 65,000 to 70,000 vehicles and began external deliveries of its next-generation R2 SUV, with CEO R.J. Scaringe noting record demo drive interest. However, fears of rising component costs and uncertain demand for the lower-priced R2 weighed on the stock, which has fallen 85% since its 2021 initial public offering.

A Better Bid reports that Tesla salvage listings on its platform have surged sevenfold since 2019, with the brand now accounting for 2.34% of all inventory in the first half of 2026. The median winning price for a wrecked Tesla reached $10,700, nearly triple the platform-wide median of $3,850, driven by global demand for battery modules and electric drive units. Front-end collisions dominated the 367 recorded Tesla lots, making up 162 of the total, while competing EV brands like Rivian, Polestar, and Lucid remained virtually absent from the auction blocks. The data, drawn from internal records spanning January 2019 through June 2026, highlights a single-brand salvage ecosystem where high-tech wrecks are treated as valuable assets rather than scrap.

Rivian is selling 75 million additional shares at $15.50 apiece to raise roughly $1.2 billion for aggressive AI investments, a move that mirrors the dilutive financing Lucid Group has frequently used. Underwriters have the option to buy another 11.25 million shares, which would increase Rivian's total outstanding shares by around 6%. The company quietly dropped its 2027 profit guidance earlier this year as it ramps up spending on self-driving software, which management sees as critical for future consumer and robotaxi markets. Rivian has already posted a positive gross margin in recent quarters and expects scaling production of its R2 SUV to narrow losses enough to sustain higher AI investment. The share sale is a painful but reasonable step to maximize long-term shareholder value, according to the analysis.

The US electric vehicle industry is experiencing a severe financial downturn, with pure-play startups Lucid and Rivian burning through billions in cash while legacy automakers take massive write-downs. Lucid, once valued at $91 billion, is now worth just $2.87 billion, and its free cash flow was negative $3.8 billion for full-year 2025 against revenue of $1.35 billion. Rivian's cash reserves shrank from $4.81 billion to $2.85 billion, and it reported negative free cash flow of $1.08 billion in Q1 2026. Stellantis posted a $22.33 billion net loss for fiscal 2025, with CEO Antonio Filosa admitting the company overestimated the pace of the energy transition, while Ford recorded $10.7 billion in EV-related impairments and program cancellations in Q4 2025. Tesla remains the segment leader with a roughly $1.2 trillion market cap, but its Q4 2025 deliveries fell 16% year over year to 418,227 vehicles, and prediction markets doubt its near-term robotaxi and Optimus timelines.

Rivian shares dropped 11.9% in the first half of 2026, according to data from S&P Global Market Intelligence. The electric automaker raised its 2026 delivery guidance to between 65,000 and 70,000 vehicles after second-quarter deliveries of 12,194 topped expectations, but rising expenses and widening losses led management to abandon its goal of achieving adjusted EBITDA profitability in 2027. A first-quarter adjusted EBITDA loss of $427 million, worse than the $329 million loss a year earlier, and a 10% increase in capital expenditures to $372 million contributed to the sell-off. The stock fell an additional 18% in early July after Rivian announced a capital raise of about $1.2 billion through the sale of 75 million additional shares. The company also launched its new R2 SUV, with an initial Performance trim priced just under $58,000 and a Standard trim expected around $45,000 in late 2027.

Tesla posted its strongest second quarter ever, delivering 480,126 vehicles, a 25% jump from last year and a 34% increase from the first quarter. The results far exceeded the company's own expectation of roughly 406,000 deliveries, with Model 3 and Model Y accounting for more than 467,000 units. This marks the first quarter since sales peaked in 2023 in which Tesla has reported year-over-year delivery growth. The company also deployed 13.5 gigawatt-hours of energy storage products, up from 9.6 gigawatt-hours a year ago. Despite the strong quarter, Tesla faces challenges including backlash against CEO Elon Musk, the loss of the federal EV tax credit, and increased competition, while its stock trades at a premium with a forward price-to-earnings ratio of nearly 180.

Rivian ranked last in J.D. Power's 2026 U.S. Initial Quality Survey with 246 problems per 100 vehicles in the first 90 days of ownership, while CEO RJ Scaringe received a $406 million pay package. The company has only four service centers in Texas and one in Arizona, contrasting with Ford's F-150 Lightning which offers decades of reliable service coverage. Rivian's stock has fallen 87% since its IPO, and it lost $416 million in the first quarter on revenue of $1.38 billion while producing just 12,613 vehicles in the second quarter. The new R2 SUV, with a base price of $44,990, is intended to turn things around, but the currently available R1S SUV starts at $83,990 and the R1T pickup at $79,990, with prices easily exceeding $100,000 with added features.

SK hynix made its U.S. debut this week, completing the largest initial public offering ever by a foreign company in the United States. The South Korean memory maker sold 177.9 million American Depository Receipt shares priced at $149 each, raising $26.5 billion. Shares opened at $171.21 on Friday, briefly touched $179, and closed at $169.21. The broader market saw mixed results as geopolitical tensions resurfaced after President Trump declared the Iran ceasefire over and the U.S. launched strikes on Iran. PepsiCo reported second-quarter revenue of $24.2 billion, beating expectations, but its stock slipped on concerns over weak U.S. consumer demand. Microsoft announced about 4,800 job cuts, or just over 2% of its global workforce, including a major restructuring of its Xbox business. Meta Platforms released its new Muse Spark 1.1 artificial intelligence model, calling it a significant upgrade for agentic tasks. Micron Technology accelerated its U.S. investment plans, increasing expected spending to more than $250 billion through 2035. Rivian Automotive shares fell around 14% after announcing a 75 million share common stock offering. Alibaba Group rose on signs of improving profitability in its artificial intelligence businesses. Circle Internet Group gained after receiving approval to establish a national trust bank. For the week, the Nasdaq Composite added 1.74%, the S&P 500 climbed 1.23%, and the Dow slipped 0.50%.

Tesla is the more attractive electric vehicle stock for a $1,000 investment compared to Rivian, according to a Motley Fool analysis. Tesla remains the global EV market leader, recently reporting second-quarter deliveries of 480,126 vehicles, a 25% year-over-year increase that beat analyst estimates. The company's investment thesis is increasingly tied to its robotaxi and humanoid robot projects, with a robotaxi launch in Miami and a potential Optimus 3 reveal expected soon. Rivian launched its R2 midsize SUV and delivered 12,194 EVs in the second quarter, exceeding its 9,000-to-11,000 projection, and has a deal with Uber for up to 50,000 autonomous EVs by 2031. However, Tesla's stronger brand, economies of scale, ability to fund ambitions without dilutive financing, and greater flexibility make it the preferred choice, with two shares purchasable for $1,000.

Tesla has introduced a long-wheelbase version of its Model Y in the United States, with the Model Y L Premium Launch Series now available for order starting at $61,990 for a six-seat configuration. The new variant is 7.6 inches longer than the standard Model Y, with a wheelbase extended by 5.8 inches to 119.7 inches, providing additional interior space especially for the third row. It also features premium additions such as vehicle-to-load bidirectional power, an electronically controlled continuously variable suspension, and a 12-month trial of Full Self-Driving (Supervised). Deliveries are expected to begin this fall. The launch comes as competition intensifies in the midsize electric SUV segment, with Rivian recently beginning deliveries of its R2 midsize SUV and Lucid preparing to introduce new models on its midsize platform later this year.

Jim Cramer says the flood of new stock and bond issuance hitting Wall Street poses a bigger danger to the bull market than the Iran conflict. On his July 8 show, the Mad Money host pointed to nearly $195 billion in new equity raised since early June, including SpaceX’s record $85.7 billion IPO, Alphabet’s roughly $80 billion stock sale, Rivian’s $1.5 billion discounted offering, and SK Hynix’s upcoming roughly $28 billion Nasdaq listing. Cramer warned that such supply can drain capital from existing holdings, with Nvidia already shedding almost $1 trillion in market value from its peak as institutions sell winners to fund new deals. He cautioned that if the pace continues, the bull market could suffocate under the weight of new paper, though a pause in offerings or more merger activity could still rescue the rally.

Jim Cramer expressed dislike for Rivian's discounted capital raise, calling it a worrisome sign for the bull market. Rivian raised $1.2 billion by selling 75 million shares at $15.50, down from $20. Cramer noted the deal worked but was priced very low, describing it as a deep-in-the-hole deal that is not encouraging.

Three industrial stocks are showing warning signs that may concern investors. Snap-on has seen no organic revenue growth over the past two years and flat earnings per share, with shrinking returns on capital suggesting increasing competition. Lockheed Martin posted annual revenue growth of just 2.6% over five years while earnings per share fell 3.7% annually, indicating less profitable incremental sales and eroding returns on capital. Rivian has struggled with flat vehicle deliveries, cash-burning operations, and a short cash runway that raises the risk of a dilutive capital raise.