Is Jim Cramer warming up to Rivian (RIVN) -)?
The CNBC host certainly didn't have much in the way of love for the electric vehicle maker back in the spring.
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During the Lightning Round portion of his June 5 "Mad Money" program, Cramer zapped both Rivian and EV company Lucid (LCID) -) in what he called a "two-for-one."
"Losing too much money," he told a listener. "We don't need money-losers on Mad Money. I have to protect people from these companies."
Rivian was going through a tough period, burning cash as it ramped up production, cutting its targets and watching its market cap tumble.
A short time after Cramer made his comments, the company was removed from the Nasdaq 100.
'An unbelievably positive note'
But things have apparently changed as the leaves start to fall from the trees. Amazon (AMZN) -), which has a roughly 17% stake in the company, added its 5,000th Rivian van to its electric vehicle delivery truck fleet.
Speaking on "Squawk on the Street," Cramer urged investors on Sept. 27 to watch the electric vehicle company's stock after bullish comments from Baird analyst Ben Kallo, who labeled Rivian stock a “fresh pick” in his latest note.
“This is just one unbelievably positive note,” Cramer said. “If you’re looking for an [EV name] that’s doing well, let’s point to Rivian. It's a really good piece of research."
Kallo wrote that "concerns regarding third-party reports of weakening demand have led to recent weakness in the stock, and we believe underlying demand remains strong with production improving," according to Teslarati.
"We see Q3 deliveries as a near-term catalyst and expect sentiment to improve as Rivian continues to realize cost benefits from an improving supply chain and the use of in-house components," he said.
Not all analysts are as enthusiastic about Rivian.
CFRA analyst Garrett Nelson, who rates the stock sell, wrote on Sept. 23 that "we don’t expect Rivian to generate positive gross margins for some time, but we think the Amazon supply agreement should help it generate stable cash flow over the next few years."
Rivian delivered 7,946 units in the first quarter, exceeding expectations, and beat Wall Street’s estimates again in the second quarter after announcing 12,640 deliveries.
Meanwhile, Rivian Chief Executive RJ Scaringe said recently that he was not worried about competition from Tesla's (TSLA) -) long-awaited Cybertruck.
Rivian's CEO not worried about Tesla
“If you were to think of the Venn diagrams with customers, there's probably not a lot of overlap,” Scaringe said at Code Conference 2023, according to Yahoo Finance. “But I think it's great that a product like that exists in the world."
"If we truly want to electrify everything that's produced – to give us some scale – there's 1 1/2 billion cars on the planet, and we as a planet produce 90 million a year," he said.
Tesla has over 20,000 employees in the Austin area, most of them located at Gigafactory Texas, and plans to triple that number to 60,000 as it ramps up Cybertruck production, the Austin Business Journal reported.
Earlier this month Chief Financial Officer Claire McDonough said Rivian would benefit from significant deflation for battery-material prices in 2024, Reuters reported.
Prices for raw materials used in batteries surged to a record as demand for EVs jumped and material supplies tightened, due to the pandemic and worsened by Russia's invasion of Ukraine.
"We'll see some of those (price) impacts in the Q4 timeframe of this year, certainly will impact as we look to 2024," McDonough said at the Goldman Sachs Communacopia + Technology conference.
She said that impacts of falling commodity prices would likely be felt in the fourth quarter and into next year. Lower costs of battery raw materials could potentially boost margins for Rivian and its rivals, which have struggled with high costs and dwindling cash balances.
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