Rivian (RIVN 3.14%) is an exciting story stock, and the story is getting better every day. That said, it is an aggressive investment that only growth-minded investors will want to buy. Here's what you need to know before you buy Rivian, noting that more good news could drive the shares higher over time. And, thus now, while the stock is still in the dumps, could be the time to buy like there's no tomorrow.
What does Rivian do?
Rivian makes all-electric trucks for both commercial (delivery trucks) and personal use (pickups). It is still building out its business, so there's a lot of red ink today. However, the company managed to turn a gross profit in the fourth quarter of 2024 and in the first quarter of 2025. That means it made more selling its trucks than it cost to build them, which is an important step on the way to turning a profit on the bottom line.
Image source: Getty Images.
If you are looking at Rivian today you are hoping you can catch a little of the lightning that Tesla (TSLA 1.31%) generated. The electric vehicle (EV) market has changed greatly since Tesla basically created it, so the competitive landscape is a lot more fierce. But Rivian looks increasingly like it may end up a winner. Here are three key reasons to like the stock.
1. Rivian has big partners
Tesla set out on its own to prove that EVs were a viable product. Rivian isn't taking that approach. It is partnering with big-name companies to help support its business as it looks to break into the auto sector. Early on it teamed up with Amazon (AMZN -0.67%) to build delivery trucks. That provided funding for the ramp-up of Rivian's business. More recently it has partnered with Volkswagen, which is providing cash in exchange for the ability to use Rivian's technology in its own vehicles.
Ultimately, these relationships give Rivian valuable access to capital and customers. This provides it with a strong foundation for building out its business over time. And that means this business has a stronger foundation than you might think given the still relatively early start-up nature of the operation.
2. Rivian has already scaled up
Breaking into the auto sector is hard, at least partly because of the capital-intensive nature of the business. Put simply, it costs a lot of money to build a car factory. And building it is just the start, given the massive complexity of building a car. Rivian has proven it can build a large auto factory, with the company expecting to deliver as many as 46,000 vehicles in 2025.
In fact, a key focus now is on improving the production process. That has meant taking a breather on the production growth side of things, but cost cutting and streamlining allowed Rivian to turn a gross profit. And the knowledge it gains from this effort will help it as it expands its production in the future.
3. Rivian is working on a mass market truck
That brings Rivian's story to the R2 truck, which it hopes to introduce in the first half of 2026. Right now, Rivian's consumer trucks are very expensive, which limits the number of likely buyers. The R2 is going to be more affordable, and the hope is that the truck will attract mass market customers.
This is the exact approach that Tesla took with its vehicles. And the introduction of a mass market vehicle proved to be an important growth driver for Tesla. It could do the same thing for Rivian, and the inflection point looks like it might be right around the corner.
Rivian is still well off its highs
Rivian's stock price is down around 90% from the highs it reached after its initial public offering in 2021. Back then, EV stocks were hot. They are not hot now, but that could be an opportunity for more aggressive investors. Indeed, a lot of EV companies have fallen by the wayside, but Rivian keeps trucking along.
And it looks increasingly like it will be an industry survivor, given its big partnerships, the scale it has achieved, and the important new vehicle launch it has coming up. If you can handle buying an upstart business in a competitive industry, Rivian might be a good fit for your portfolio.
