Why Rivian Stock Plunged Today
Key Points
Rivian is burning through cash.
Shareholders don't like dilution.
- 10 stocks we like better than Rivian Automotive ›
Shares of Rivian Automotive (NASDAQ: RIVN) reversed course on Tuesday after the electric vehicle (EV) manufacturer announced a sizable capital raise.
Image source: Getty Images.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
Deliveries are rising, but so are production costs
On Thursday, Rivian announced that it delivered 12,194 vehicles in the second quarter, handily exceeding its guidance of 9,000 to 11,000 deliveries. Strong sales of the company's pickup trucks and delivery vans contributed to the outperformance.
The results prompted the automaker to boost its full-year deliveries goal to 65,000 to 70,000, up from a prior forecast of 62,000 to 67,000.
Unsurprisingly, the news drove investors to bid up the EV maker's shares.
Yesterday, however, Rivian said it would sell 75 million shares of its stock to raise cash. The company also granted underwriters a 30-day option to purchase an additional 11.25 million shares.
Based on current prices, the share offering could raise more than $1.4 billion. Rivian plans to use the proceeds to fund its growth initiatives and equity contributions related to a loan from the U.S. Department of Energy.
Disdain for dilution drove investors to sell
Rivian's share sale reminded investors that it's still a long way from achieving sustained profitability. And even when the EV upstart performs well, as it did when it raised its full-year vehicle delivery target on July 2, the good news is often followed by stock offerings that can halt and even reverse its share price gains.
That can be frustrating for all but the most patient investors. Many shareholders, in turn, decided to sell today.
Should you buy stock in Rivian Automotive right now?
Before you buy stock in Rivian Automotive, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Rivian Automotive wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $409,970!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,200,223!*
Now, it’s worth noting Stock Advisor’s total average return is 916% — a market-crushing outperformance compared to 210% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of July 7, 2026.
Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Recommended Articles
