Looks like $RIVN might be printing an evening star candle today on its 5th day of trading with a valuation of $143 Billion and revenue of $0 (ZERO).

Will load up when the nonsense stops.

Idk if it’ll ever catch up to $TSLA ~ solid competitor for all auto manufacturers tho.
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Sufi's avatar
@sufiofwallstNovember 16
Author
The money printing has relatively skewed valuations and multipliers.

We’ll stay at these elevated skewed levels until this excess liquidity gets pulled out of the system. The only way that happens (with the current economic paradigm) with fed increasing rates and tapering asset purchases even faster.

As long as feds balance sheet keeps growing i.e. they keep pumping liquidity into the system, we’ll keep seeing these seemly ridiculous valuations which if think about it…are actually normal when you take into consideration the excess liquidity thats in the system. They just look ridiculous relative to the time when we did not have this excess liquidity in the system.

Quantitative easing vs quantitative tightening —————> multiple expansion vs multiple contraction.

Thats at the core of it all.
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delos's avatar
@diggityNovember 16
we are deep into crazy town territory on these valuations
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Sidni Standard's avatar
@diggity say that louder for the people in the back!!
I wonder when the market will finally correct these astronomical valuations 🤔

Many times having an abundance of capital is bad for companies... being 'hungry' inspires people to try new ways out of desperation, and I think a lot of companies today aren't experiencing that anymore
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Ayesha Tariq, CFA's avatar
Seriously.... I love the stock market! And people laugh at the tulip mania! We're living it all over again, and this won't be the last time.
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Nathan Worden's avatar
Reminds me of some of the run ups in SPACs we saw in February Skillz comes to mind as an example.

If I had to guess Rivian will do the same. The question is timing.

Futures indicate about a 75% chance for a rate hike by next summer. If I had to guess, Rivian will be much lower a year from now. (But after that hopefully it can execute on production and grow into a reasonable valuation.)
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Sufi's avatar
@sufiofwallstNovember 16
Author
@nathanworden agreed ~ with the $AMZN backing $RIVN , they should have no trouble having access to capital and talent that allows them build and deliver products in the right ways. Once the stock chart looks more reasonable, i don’t see how it can’t deliver stellar returns in the long run.
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Nathan Worden's avatar
I'm interested in seeing how 'production hell' goes for them. Will Amazon be able to make this easier for them than it was for Tesla? If Rivian can scale production with less hiccups, it's going to make Tesla look bad 😆
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good point and seriously, no pun intended, but there are so many moving parts in creating a car from scratch that it is a certainty that they will struggle with quality in the first years. In terms of the valuation of these new manufacturers, how many cars will the industry need to produce to ever justify these stock prices
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Sufi's avatar
@sufiofwallstNovember 16
Author
@nathanworden agreed ~ i feel like with the rivalry between bezos and musk its not really $RIVN vs $TSLA but more like $AMZN vs $TSLA …. In the past $AMZN took on $WMT on the retailing turf and now they’re taking on $TSLA (and everyone else) on the automotive manufacturing and retailing turf via $RIVN 🤷🏻‍♂️

I think because $TSLA has paved the way and solutioned bottlenecks, if $RIVN takes a few pages out of that play book (hire $TSLA talent as well) they can catch up to a certain extent because $TSLA is more than just a car company. They’ve got the deadly combo of manufacturing software and hardware with tentacles leaning into clean energy technologies, ride sharing, insurance etc….add to that the stuff they can pull in form SpaceX (starlink satellites) and nuralink (monkey drivers 🤪) ~ no one can really match that 🤯
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Conor Mac's avatar
My mind is blown, no way to explain this
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