Rivian (RIVN) Valuation Check After New Autonomy, AI Platform Strategy and Custom Chip Announcement

Rivian Automotive (RIVN) just used its first Autonomy and AI Day to draw a clear line in the sand, laying out custom in house chips, an autonomy subscription model, and a broader AI driven platform strategy.

See our latest analysis for Rivian Automotive.

The Autonomy and AI Day has clearly lit a fire under sentiment, with a 1 day share price return of 12.1 percent contributing to a 90 day share price return of 35.4 percent. However, the 3 year total shareholder return of negative 18.1 percent shows the longer journey is still bumpy and momentum is only now rebuilding.

If Rivian’s AI push has you rethinking the whole sector, it could be a good moment to scan other auto innovators via our auto manufacturers and compare what the market is rewarding.

Yet with shares now up sharply in the past quarter but still below their post listing highs, is Rivian quietly undervalued on its new AI story, or are investors already paying upfront for that future growth?

Most Popular Narrative: 24.2% Overvalued

With Rivian Automotive’s fair value in the narrative sitting at roughly $14.83 against a last close of $18.42, the story leans toward optimism on growth and margins.

In order for you to agree with the analyst's consensus, you would need to believe that by 2028, revenues will be $15.7 billion, earnings will come to $788.9 million, and it would be trading on a PE ratio of 36.4x, assuming you use a discount rate of 11.7%.

Read the complete narrative.

Curious how a loss making EV maker earns a premium multiple usually reserved for software leaders, plus rapid top line expansion and margin lift, all at once? See how those moving parts are stitched together into one aggressive, tightly argued valuation roadmap.

Result: Fair Value of $14.83 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, expiring EV incentives and Rivian’s elevated cash burn could quickly challenge the bullish assumptions embedded in today’s high growth, premium multiple narrative.

Find out about the key risks to this Rivian Automotive narrative.

Build Your Own Rivian Automotive Narrative

If you see Rivian’s story differently, or simply want to test your own assumptions against the numbers, you can build a full narrative yourself in just a few minutes, Do it your way.

A great starting point for your Rivian Automotive research is our analysis highlighting 1 key reward and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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