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Rivian Automotive vs. Lucid Group? Morgan Stanley says there is a clear winner

Feb. 03, 2022 8:56 AM ETRivian Automotive, Inc. (RIVN), LCIDBy: Clark Schultz, SA News Editor66 Comments

Electric Vehicle Company Rivian Sets IPO

Spencer Platt/Getty Images News

Morgan Stanley said a survey of its clients in regard to which stock they would like to own between Rivian Automotive (NASDAQ:RIVN) and Lucid Group (NASDAQ:LCID) indicated a clear winner.

87% of the respondents said they

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Comments (66)

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Nietzche profile picture
What a shitty article! Citing Morgan Stanley? Really? 😂😂
Paper_stax profile picture
All of the arguments made against owning Lucid were also made against Tesla in its infancy. What drives a person to choose an electric vehicle when transitioning from an combustion engine vehicle is practicality and efficiency.

Why would anyone choose a less efficient EV with a lower range? They'd obviously aim for the vehicle that makes their transition seamless. That vehicle is Lucid; and with all the institutional investments previously being made in addition to the support of the Saudis, I can see them coming out on the top.
@Paper_stax I get what you’re saying but LCID and RIVN are trading at something like $40B market cap. It took Tesla like 7 years to get to that point and in that time they were shipping cars, not profitable of course but they were moving notable amounts, while developing tech, service centers, dealerships, and charging infrastructure that didn’t exist. I don’t see giving LCID and RIVN or others a shortcut on valuation based on what Tesla has done when they haven’t really done anything yet.
Tonexx profile picture
@Paper_stax Must disagree, people are not really that concerned about efficiency! They are more concerned about costs, looks, range and performance. The problem with Lucid, is that the cars look like something my Dad would own. This is not to say that I don't like Lucid, I do. What I don't like is the price.... it is crazy high. Plus there is nothing captivating about it. .
BondiBaz profile picture
@Jayc428 7 years ago EV market demand was almost nonexistent. The EV market in the last 2-3 years has been enormous. It won’t take Lucid as long to reach mass production as they are producing for an existing and rapidly growing market.
farmersgroup profile picture
Rivian should be about the same price as Lordstown now. Their pickup trucks look pretty much the same. Only Lordstown doesn’t have support from Amazon’s boss. Look at Rivian stock price, it looks like Jeff already left the scene. Lucid made a safer and stronger car than Tesla S when you get hit by a truck. Go back and look at those Tesla cars that were destroyed in car accidents. I would consider buying Lucid above Tesla if I have the money.
Pamp it up, Uncle Morgy. You need to earn those fat-fingered commissions, don't you?
04 Feb. 2022
Morgan Stanley was the lead underwriter on the deal (top left) -- of course the company will pump it
Winnertakesall profile picture
Neither, both have outsized market caps, lots of capex and competitors. Why would anyone invest in a stock like this, you're better off driving to the nearest casino and putting it all on Red or Black.
@Winnertakesall hmm what are the competitors? Honda? Ford? Don't think so.
@Winnertakesall Both will need equity raises, but RIVN has the backing of Amazon.
without saudi money, LCID is worthless.
@invisible7 Even with Saudi money, LCID is worthless.
One is SPAC and other one is IPO? Which one gave these bankers millions in commission for IPO?
All I can say is that Rivian autos & trucks are butt ugly designs. I would buy a lucid or tesla any day.
@archiitek all I can say is Apples/Oranges. If you don't need a truck - even a diminutive/semi-useful one like the Rivian (sized like the Maverick, basically), then you wouldn't look at it, regardless of your subjective feelings about its design. I think potential truck buyers look at the Rivian and think "small truck," not "cool new electric car shaped like a truck." I could be wrong, but this is how the Rivian hits me (a truck owner): It's an odd looking little truck that runs on electricity. So the question is really: will it serve the need of that potential buyer? Will it take share from the small/midsize Tacoma/Frontier sized trucks, or is it only competing with what I am calling "fake trucks" (meaning they aren't serious work or tow or haul vehicles) -- unibody vehicles like the new Ford Maverick or that Hyndai Santa Cruz or Honda's Ridgeline (basically rebodied sedans and Crossovers -- what they call "Ute" in Australia)? Will the Rivian be more attractive to well-heeled truck buyers who think it's cool enough to justify the price compared to those "fake trucks." They hope: yes. Nobody really knows yet. As for the sedans: the LUCID is gorgeous, truly, inside and out ... and a hell of a lot of fun to drive -- and plenty quick enough with lots of range. It's just really expensive and we don't know anything about reliability or longevity yet. The Tesla broke some new ground design-wise, but their performance pkg vehicles are the really amazing aspect to me now -- like goofily named PLAID model, which has damn near supercar power at the throttle. THAT is fun. Aftermarket suspension can really elevate the handling as well. I guess it's gonna be a while before they have every day customers who aren't wealthy early adopters happy to spend whatever to be coolest kid in school.
@GearheadInLA where I live, half the vehicles on the road are trucks, and half of those truck owners have work/lifestyles that require a truck. Saving the planet is low on their priority list. Very few of them will buy a Rivian R1T. They MAY buy a Ford F-150 lightening, but only after it has shown reliability, range and convenience equivalent to the gas-burning version.
It seems
You didn’t read Rivians award winning recap for Motor Trends truck of the year regarding how it hauled compared to iCE pickups
truwa profile picture
What happened to the question "is the product is profitable?".

Nobody cares I gıuess. But the math is simple : You cannot sell a truck with 135kW highest density expensive battery cells for $70K - $80K (unless you are building the cells yoırself for 50% less). This stock is going under $30 in less than 2 years, each quarter's losses will be a new record. You will see.
Legacy Legends, LLC profile picture

The stock will probably hit $30 after lock up expires May 2022.
that write up is a garbage - what is the justification for RIVN value at 54 BN right now or LCID at 45BN? they each have Price to Sales of 53K and 63K - so what happens to their valuations when they "scale" or "ramp" or whatever happens - what exactly is the multiple they expect if they get to TSLA's 50BN in sales? are they going to take less than a 17x price to sales? because if the answer is no, then why own them and not TSLA now? Does MS tell us what the fairy dust means in terms of specifics of sales and profit that gets RIVN to $147?

these stocks are poster children for retail lunacy - The only thing that would top them is if PTON said they were making a spin bike - EV you could ride to the supermarket and that got it a 40 BN value
Wez profile picture
"these stocks are poster children for retail lunacy"

Agreed, but it's not just retail, big money is in these stocks and pushing the valuations deep into lunacy...
@Wez interested to see what happens when the lockup period ends around May 9 for rivian
Folger profile picture
@guugleizevil I completely agree with you. Any bullish comment from MS re: RIVN is simply to protect their position in it. RIVN's valuation is absurd, especially in light of the change in sentiment for equities where unprofitable companies are no longer darlings.
Rex Rode profile picture
Was happy to buy LCID for $17 after the first lock up. Rode this train to $55. Just bought back at $26. With so much Saudi money behind LCID practically guarantees success. I will happily start selling though at $40. Always remember, investing is about making money, not being right.
Wez profile picture
@Rex Rode
"practically guarantees success"

Stopped reading here...
@Rex Rode or about battery tech or profitability. in todays market.
hah? the clear winner in the EV space is TESLA. no doubts about that.
@Concernedabout "No doubts" is never a good mantra in investing.
I wouldn’t buy either at current prices.

Rivian at $20-$30 could be a decent spec play.
Wez profile picture
Their stock prices will both be losers...
Zeusy Zeus profile picture
These comments are hilarious… I look forward to my mornings where I drink my coffee and read comments about Rivian and other EV companies on here. When the EV stocks are going down (along with everything else in the market) the bashers are here full force but when they’re going up they’re silent. Everyone’s an expert when the markets trading one single way. Love it 😂

I’m not going to preach about Rivian long term because it’s getting redundant at this point if you think EV companies are too risky or not good don’t invest in it. It’s that simple. Coming on here and bashing it because you probably have stock in Tesla or Ford is just comical at best.
@Zeusy Zeus Not sure what you are trying to say here. You think all EV stocks will go up and survive?

The history of manufacturing autos, tech disruption and consumer tastes all strongly indicate there will be winners and losers in the unpredictable EV space. The hare may lose to the tortoise, the winners may fade and some may struggle but survive and then prosper. Anyone who thinks they have certainty here needs to re-examine their assumptions. The list of bankrupt extinct car companies is extensive and a very cautionary tale.
@Zeusy Zeus Nah the Rivian puts be hitting tho.
Zeusy Zeus profile picture
@RealRural Where did I say all EV stocks will go up? I'm simply having fun with the trolls on this website who have nothing better to do than to come on here and bad mouth other stocks (typically because they own rival stock companies).

But since we are on the topic... So you think that companies investing billions and billions of dollars are just going to magically disappear at some point if they don't make it? All that R&D and technology is just going to vanish into thin air. Question for you... Say a company like LUCID doesn't survive in the long run what do you think will happen to it? *thinking emoji*
My winner will be SLDP (Solid Power) - developer and producer of all-solid-state battery technology and proprietary electrolyte materials for Ford and BMW. Rivian might also end up being a customer of Solid Power, along with other OEMs.
03 Feb. 2022
There is a winner.... Volkswagen !!!
@TH3rd I have started seeing the ID 4 in my area. It is a nice looking vehicle and VW has a lot of heft and manufacturing experience. I would bet it is going to be one of the winners.
v4255 profile picture
I think it is way simpler: MS is an IPO bank for Rivian, so this is where the loyalty lies. This will be at least before the lock up expiry in May. Both companies are overvalued.
“An investment in either company requires a need for long-term thinking and preparation for significant potential volatility”

Translation: These stocks are awful. Run, do not walk, to the nearest exit.
@arnold.bird Or some might translate: Buy on the dips. None of us knows who will win out, truthfully.
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