2022 has gotten off to a volatile start on Wall Street, and even the high-flying Nasdaq Composite (^IXIC -2.05%) hasn't been immune from the ups and downs of the stock market. After seeing some losses earlier in the week, though, the Nasdaq got a much-needed boost on Wednesday. By just before noon ET, the index was up more than 1%.
The more favorable market environment didn't prevent some companies from seeing losses in their share prices. One notable decliner was Rivian Automotive (RIVN -2.27%), which made a controversial move that risks the loyalty of its early adopters. However, a somewhat surprising company from the retail industry was able to post gains that helped contribute to the Nasdaq's gains. First, let's take a closer look at what's sending Rivian's stock lower, and then you'll learn the identity of this strong-performing retailer.
Rivian looks to hike prices
Shares of Rivian Automotive were down more than 12% late Wednesday morning. The electric truck manufacturer has faced a difficult dilemma, and the decision it made led to negative publicity from those who see Rivian's move as violating an implicit contract between customers and the company.
Image source: Rivian Automotive.
Rivian said that it would raise prices on its two planned electric vehicles. The price of the R1T electric pickup truck will go up by about 17% to $79,500, while the R1S electric sport utility vehicle will see a 20% boost to $84,500. In addition to the base vehicle costs, consumers can expect prices on optional features like custom accessories and upgrade packages to rise as well.
The increase comes as Rivian faces inflationary pressures on the costs of the components it needs to build its vehicles. At the same time, supply chain shortages and delays in obtaining parts and other necessary supplies for manufacturing are contributing to the pressure on the automaker.
What's particularly irksome for would-be Rivian buyers is that the price increases apparently won't provide an exception for those who've already placed orders for vehicles. As a result, some consumers are considering withdrawing their commitments. For a company that's hoping to make a big splash in a fast-growing market that's hungry for new products, Rivian can't afford to make a major execution mistake in its rollout.
Ross offers great value
Meanwhile, shares of Ross Stores (ROST 1.17%) were up more than 8%. The apparel discounter posted encouraging fourth-quarter financial results and sees good times ahead in the coming year.
The company's fourth-quarter numbers were strong. Revenue moved higher by 18% to $5.02 billion, closing a year in which Ross saw sales jump more than 50% from 2020. The company even posted higher revenue than it did in the pre-pandemic period two years ago. Comps were up 9% versus the same period in 2019. Adjusted earnings came in at $1.04 per share for the quarter and $4.87 per share for the full year.
CEO Barbara Rentler was pleased with the performance. She noted that Ross was able to overcome the omicron variant COVID-19 surge during the holiday season, as well as ongoing problems with supply chains.
Moreover, Ross expects momentum to build in 2022. Comps are likely to be flat to up 3%, building on 2021's strong 13% annual gain. Earnings of $4.71 to $5.12 per share will reflect a potential slow start to 2022 but with potentially improving conditions as the year progresses.
Retailers have had a tough time, but Ross has been able to weather the storm better than many of its rivals. The company's discount focus should play well even if economic pressures continue to force consumers to make difficult choices in their budgets.
