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This performance is in line with InvestingPro’s data which shows a significant 1-month price total return of -21.45%, and a 1-year price total return of -50.3%. However, it is worth noting that the company’s 6-month price total return stands at a positive 26.26%, indicating some recovery.
The newly minted “green” convertible senior notes, set to mature in 2030, will accrue interest at a rate of 3.625%, lower than the previous $1.3 billion offering’s rate of 4.625%. The initial conversion rate for the latest offering is set at a premium of 27.5% above Thursday’s closing price, suggesting a potential gain of 15.7% in the stock over the 19-month gap between the offerings’ conversion periods.
InvestingPro’s data reveals that Rivian’s market cap stands at $17.32 billion, with a P/E ratio of -3.61. The company’s revenue for LTM2023.Q2 was $2.981 billion, showing a growth of 479.96% and a quarterly growth of 207.97%. However, Rivian’s gross profit margin for the same period was -96.08%, aligning with InvestingPro Tips that highlight the company’s weak gross profit margins and the fact that analysts do not anticipate the company will be profitable this year.
Despite recent fluctuations, Rivian’s stock has seen an overall increase of 24.8% since the last offering. The company’s third-quarter results are expected to be released in early November.
Before this offering was priced, Truist analysts maintained their Buy rating on Rivian’s stock and set a $30 price target, reflecting what they referred to as Rivian’s “opportunistic” capital raising strategy. This aligns with InvestingPro’s fair value estimate of $26.32 for Rivian’s stock.
In broader market activity, the yield on the 10-year Treasury note rose by approximately 0.74 percentage points during this period while the S&P 500 index declined by 3.5%. Concurrently, Rivian’s rival Tesla (NASDAQ:TSLA) Inc.’s stock has lost 6.0% over the past three months compared to Rivian’s loss of 15.5%.
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