From Top Electric.

Stock Market: Are Lucid and Rivian the Top EV Stocks to Buy Now? Is Tesla’s Reign Over? The electric vehicle (EV) market is facing turmoil due to U.S. tariffs on imported vehicles and global economic uncertainty, leading to sharp stock price declines across the sector. Rivian and Lucid, two U.S.-based EV manufacturers, are positioned to potentially benefit from these tariffs, as their domestic production facilities shield them from import-related cost increases. Rivian, known for its R1T truck and R1S SUV, is struggling with a 90% stock price drop from its peak, stagnant growth, and negative cash flow, projecting lower production in 2025. Its R2 model, set for 2026, could drive future growth but risks cannibalizing higher-priced sales. Lucid, with its Air sedan and new Gravity SUV, forecasts doubled deliveries in 2025, offering stronger growth prospects. However, its smaller scale, negative cash flow, and niche premium focus pose risks. Both companies’ stocks, trading at $12.50 (Rivian) and $2.40 (Lucid), are overvalued by about 50% compared to their intrinsic values ($6.67 and $1.14, respectively), per discounted cash flow analyses. The tariffs provide a competitive edge against import-reliant rivals, but tangible benefits, like increased demand, remain elusive, as seen in Rivian’s weak Q1 2025 deliveries. Both firms face industry challenges, including high costs and the need for battery technology advancements. Investors may find Rivian slightly more appealing due to its broader market and improving cash flow, but both stocks are high-risk at current prices, potentially needing a 50-60% drop to become attractive. The EV sector offers opportunities amid the downturn, but Rivian and Lucid’s uncertain paths to profitability demand caution, with safer alternatives like bonds offering better near-term returns.

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