Data on TSLA PS Ratio (Annual) provided by YCharts indicates potential upside for Rivian. Convincing investors of a viable path to profitability could drive demand for the stock and narrow the valuation gap with competitors. While Rivian doesn’t require robotaxis or AI, achieving positive gross profits in Q4 and for full-year 2025 is crucial.
Despite recent production challenges and supply disruptions, management remains optimistic about meeting the gross profit target. Progress has been slow but steady, with the fourth quarter seen as a potential turning point. Although not expecting profit in every quarter of 2025, a positive full-year forecast is promising.
Continued improvement in gross profit could bolster investor confidence in Rivian’s long-term vision. Notably, the stock price rose after Q3 results, emphasizing the importance of achieving gross profit goals. Closing the valuation gap with competitors like Lucid, whom Rivian surpasses in annual vehicle sales, hinges on sustained profitability.
However, challenges lie ahead with potential policy changes under the incoming administration and a lack of significant catalysts in 2025. The uncertain policy stance toward EVs and the absence of major launches this year could dampen stock performance. Rivian’s success hinges on cost reduction and profitability, with Q4 gross profit being a critical factor for unlocking near-term growth potential.
Investors should weigh these factors before investing in Rivian. As per The Motley Fool Stock Advisor analysts, there are other top stock picks that could offer substantial returns in the future.
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