Rivian and Uber tie robotaxi plans to autonomy milestones

Rivian Automotive (RIVN) stock is in focus after the company and Uber announced a partnership that links up to US$1.25b of Uber investment to Rivian’s autonomous driving milestones.

The agreement includes plans for 10,000 fully autonomous R2 robotaxis in an initial phase, with potential deployment of up to 50,000 R2 based vehicles on Uber’s platform if performance conditions are met.

Rivian’s recent 2.1% 1 day share price return to US$16.10 and 5.4% 30 day share price return contrast with a 23.8% 90 day share price decline. The 30.3% 1 year total shareholder return points to recovering momentum around the Uber partnership, R2 launch plans and fresh funding.

If this robotaxi news has you thinking more broadly about how AI is reshaping transport and infrastructure, it could be worth scanning 31 robotics and automation stocks for other automation focused names catching investor attention.

With Rivian trading at US$16.10, sitting at a discount to the average analyst price target and an estimated intrinsic value, the question for you is whether there is still mispricing here or whether markets are already factoring in future growth.

Most Popular Narrative: 36.6% Undervalued

At a last close of $16.10 against a narrative fair value of $25.41, Rivian’s current price sits well below what the most followed thesis implies.

Gen2 R1T and R1S, refinement from feedback and lower cost building

R2, R3 and R3X lower cost options for different audience.

There is a clear playbook here. Lower cost models, wider audience, and fresh software and charging revenue streams sit at the core of this valuation story. Want to see how those pieces are expected to work together and what that could mean for future cash flows.

Result: Fair Value of $25.41 (UNDERVALUED)

However, there are still real pressure points, including execution risk around autonomy milestones and the size of losses, with a net income of US$3,646m.

Another View: Rich On Sales Metrics

The user narrative leans on a fair value of $25.41, but the current market multiples tell a different story. Rivian trades on a P/S of 3.7x, compared with 0.5x for the US Auto industry, 1.1x for peers, and a fair ratio of 1.2x that the market could move towards. That gap can mean valuation risk if expectations cool, or upside if revenue scales into the current pricing. Which side do you think you are on?

Next Steps

All of this leaves a mixed picture, with clear potential alongside meaningful questions. Move quickly, review the full data carefully, then weigh up 2 key rewards and 1 important warning sign.

Looking for more investment ideas?

If you stop at Rivian, you risk missing other opportunities that may fit your goals, so keep scanning for ideas that match how you like to invest.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.