Tesla (TSLA), Rivian (RVN), Nio Share Price Outlook | tastytrade

Tesla, Nio and Rivian represent an opportunity and what can happen when your product is highly sought after in the market. General Motors and Ford represent opportunities for experienced automakers to compete in a market they don’t have to develop on their own.

Focus on electric vehicle stocks: perspectives from Tesla, Nio and Rivian

The electric vehicle market has seen an increase in investor attention over the past 12 months, with Tesla Inc. (TSLA) being the top performer. Tesla’s competitors in the manufacture of all-electric vehicles, Nio Inc. (NIO) and Rivian Automotive Inc. (RIVN), did not show growth rates in the same 12-month period that allows us to compare them. identify as direct competitors of Tesla. For this reason, we consider the automakers General Motors Company (GM) and Ford Motor Company (F) as benchmarks by which we can compare the performance of TSLA, NIO and RIVN.

How do Tesla (TSLA), Nio (NIO) and Rivian (RIVN) compare?

Fig. 1: Comparison of the 12-month percentage change in prices of SPY, TSLA, NIO and RIVN

Figure 1 shows that over the past 12 month period, only Tesla Inc. (TSLA) has outperformed the SPDR S&P 500 ETF (SPY), with TSLA and SPY remaining just below an unchanged value over the period. 12 months. While Nio Inc. (NIO) and Rivian Automotive Inc. (RIVN) experienced significant declines in value over the same period, with NIO losing nearly fifty percent of its value and RIVN losing nearly sixty percent of its value.

One of the main reasons we see a large discrepancy in the valuation between Tesla Inc. (TSLA), Nio Inc. (NIO) and Rivian Automotive Inc. (RIVN) is the number of vehicle deliveries each box has. produced. In 2021, TSLA delivered between nine hundred thousand and one million (900,000-1,000,000) vehicles, NIO delivered between ninety thousand and one hundred thousand (90,000 – 100,000) vehicles and RIVN delivered between one thousand and two thousand (1,000 – 2,000) vehicles.

For NIO and RIVN to improve their ability to compete with TSLA, they will need to increase their ability to supply products to consumers. These three EV companies continue to see pre-order volumes that indicate the market for their vehicles is outpacing their production capacity, which is positive for the industry.

Tesla vs. Rivian vs. Nio key points:

  • Tesla Inc. (TSLA) remains the dominant electric vehicle maker over Nio and Rivian over the past 12 months.
  • Tesla delivered 10 times more vehicles in 2021 than Nio Inc. (NIO).
  • Nio delivered 10 times more vehicles than Rivian Automotive Inc. (RIVN) in 2021.

How does the success of Tesla Inc. (TSLA) affect what Nio Inc. (NIO), Rivian Automotive Inc. (RIVN), General Motors Company (GM) and Ford Motor Company (F) are doing in the automotive market? electric vehicles?

electric car manufacturing price percentage comparison.png
Fig. 2: Comparison of the 12-month percentage change in prices of TSLA, NIO, RIVN, GM and F.

To better understand the performance of Tesla Inc. (TSLA), Nio Inc. (NIO), and Rivian Automotive Inc. (RIVN), we can compare them to more established automakers, General Motors Company (GM) and Ford Motor Company ( F). Figure 2 shows that TSLA outperforms Ford, General Motors, Nio, and Rivian, while Ford and General Motors outperform NIO and RIVN.

While all five companies have lost value over the past 12 months, Tesla Inc. (TSLA) has fared better than the others. We can assume that Tesla’s ability to deliver more vehicles to its customers is driving revenue growth. On top of that, we interpret its position as the near-first mass-produced EV maker as the reason why its valuation is much higher than that of its EV maker competitors. Additionally, its ability in the electric vehicle market to produce exceptional vehicles that consumers want right now, gives it a higher valuation than core manufacturers General Motors Company (GM) and Ford Motor Company (F).

That being said, Tesla (TSLA) is the big dog on the block with a huge target on his back. Nio Inc. (NIO), Rivian Automotive Inc. (RIVN), General Motors Company (GM) and Ford Motor Company (F) are racing to catch up with Tesla’s electric vehicle production volume as quickly as possible. Tesla’s comfortable status in the industry may be coming to an end soon, with the future offering more competition and a wider range of quality electric vehicles for the consumer to choose from.

Key points of Tesla vs Ford vs General Motors:

  • Tesla is the neighborhood big dog with a huge target on his back.
  • Tesla’s valued status as a near-first-to-market company may soon come to an end.
  • General Motors Company and Ford Motor Company are following in Tesla’s footsteps in the electric vehicle market.

What do the financial statements say?

Tesla Inc. (TSLA) has reported increased net income and sales growth over the past four quarters, while increasing total asset growth over the same period. This involves strong sales growth, while investing in their ability to produce more while remaining profitable.

Nio Inc. (NIO) has seen declining net profit growth over the past four quarters, while posting increased sales and increased total asset value over the same period. This implies that NIO registers more sales and increases its production capacity at the expense of revenue growth.

Rivian Automotive Inc.’s (RIVN) financial statements are limited and difficult to interpret at this early stage. RIVN announced a drop in its net profit over the last two quarters, while posting significant growth in its assets. This is what we expect from a new business trying to compete in a new market.

General Motors Company (GM) reported declining net income growth and variable sales growth over the past four quarters. Growth in total assets remained about the same and total liabilities showed a slight decrease. This implies that GM is tightening operating costs as sales have fallen.

Ford Motor Company (F) reported a significant increase in revenue growth last quarter after three quarters of minimal revenue growth. Total liabilities have decreased slightly over the past four quarters, while growth in total assets has remained constant over the same period. This implies that F has tightened operating costs while striving to increase sales. This is likely related to their announcement of their highly anticipated line of electric pickup trucks.

Key points to remember:

  • Tesla continues to be the top performer in the electric vehicle industry.
  • Nio and Rivian are poised for significant near-term growth if they can ramp up vehicle deliveries.
  • General Motors and Ford have the opportunity to prove their strengths in vehicle manufacturing in the near term.
Price correlation over 3 months electric vehicles.png
Fig. 3: 3-month price correlation for SPY, TSLA, NIO, RIVN, GM and F.

How could you trade Tesla, Nio, Rivian, General Motors and Ford in the short term?

Tesla Inc. (TSLA) continues to show growth potential while maintaining its lofty valuation. If you want to go long on TSLA, look for pullbacks on the daily chart and build your position as we are potentially seeing new all-time highs this year. The reverse is true if you’re looking to be short.

Nio Inc. (NIO) and Rivian Automotive Inc. (RIVN) remained successful short opportunities in 2022. Until their vehicle delivery rate increases, they will continue to be priced below their competitors. Conversely, if you think that NIO and RIVN are just showing their true potential, their price is currently very high.

To trade Tesla, Rivian, and Nio stocks or other EV stocks, open an account at Tasty Works

Ford Motor Company (F) and General Motors Company (GM) remain consistent choices for long-term portfolio growth, as they have a history of delivering products to their customers consistently, in both positive and negative economic conditions . Either company is unlikely to lose valuation quickly, relative to TSLA, NIO and RIVN. Ford and General Motors represent companies with significant moats in the automotive industry and will likely be competing against any newcomers to electric vehicle manufacturing. Traders might be looking to go long on price declines by looking at the daily chart. On the flip side, traders could look to go short when General Motors and Ford prices hit new all-time highs.

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Karen J. Nelson