Rivian vs. GreenPower: Which EV Stock Is a Buy Right Now?

Rivian is a pre-revenue company with a market cap of over US$100 billion, while GreenPower Motor is a small-cap company in the commercial EV segment.

| More on:
Car, EV, electric vehicle

Image source: Getty Images

The last few trading sessions have seen growth stocks lose significant momentum. But a pullback in stock prices allows investors to buy a company at a cheaper multiple. Electric vehicle, or EV, stocks are trading lower in the past month, making companies such as Rivian (NASDAQ:RIVN) and GreenPower Motor (TSXV:GPV)(NASDAQ:GP) attractive bets right now.

Let’s see which EV stock between the two should be part of your buying list for 2022.

The bull case for Rivian

A company that recently went public, Rivian Automotive is valued at a market cap of more than US$100 billion. While it’s yet to begin large-scale deliveries of its EVs, the company already commands a higher market cap compared to legacy auto manufacturers such as General Motors and Ford.

However, Rivian is backed by Ford and tech giant Amazon, which provides it with the required financial flexibility to succeed over the long term. Amazon, in fact, has placed a pre-order of 100,000 delivery trucks with Rivian, making the latter a Wall Street favourite.

According to reports from TheFly.com, several Wall Street analysts initiated coverage on Rivian and remain bullish on the EV company.

Wedbush explains that mass production for Rivian’s electric pick truck and electric SUV will begin in the first quarter of 2022. In addition to Amazon, Rivian also has pre-orders totaling 48,000 vehicles and is well poised to gain market share in this rapidly expanding segment.

Morgan Stanley emphasized that Amazon’s pre-orders for Rivian’s delivery vans might surpass 300,000 units by 2026 bringing in billions of dollars in sales for the company.

Rivian has begun deliveries of its five-passenger pickup truck called the R1T, which is priced starting at US$67,500. It will shortly launch its seven-passenger SUV called the R1S, which is priced starting at US$70,000. By the end of this year, it aims to sell 1,000 R1Ts and 15 R1Ss, bringing in close to $70 million in sales in 2021. These numbers should rise exponentially in the upcoming decade.

The bull case for GreenPower Motor

A company that targets the commercial EV space, GreenPower Motor is valued at a market cap of just $335 million. In fiscal Q2 of 2022, which ended in September, the company’s sales rose by 57% year over year to $4.44 million, as GreenPower began deliveries of the electric school bus in California.

It posted a net loss of $2.74 million, or $0.12 per share, which was wider than the loss of $0.08-per-share forecast by analysts.

GreenPower is a small-scale manufacturer of battery-powered buses and vans. In the last year, it has focused on maintaining a vehicle inventory that can be completed as per the customer requirement, which, in turn, reduces overall order-to-delivery times. In the September quarter, GreenPower delivered 44 vehicles of which it sold 34 and leased 10 units. It ended the quarter with an inventory of 70 vehicles and another 260 units in various stages of production.

The company’s sales are forecast to rise by 246% to $41.1 million in 2021 and by 209% to $127 million in 2022. This will allow GreenPower to report earnings per share of $0.33 in 2022 compared to a loss of $0.41 per share in 2021.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Fool contributor Aditya Raghunath has no position in any of the stocks mentioned. The Motley Fool recommends Amazon.

More on Investing

Dividend Stocks

I’m Betting My Future on This Magnificent Canadian Dividend Giant

This solid utility stock could have a place in any investor's portfolio whether they're looking for income or total returns.

Read more »

Canadian dollars are printed
Dividend Stocks

This 1 Stock Could Turn Your $10,000 TFSA Into a Tax-Free Goldmine

Stop worrying and just invest with this easy buy of a Canadian stock that just keeps growing.

Read more »

Abstract Human Skull representing AI
Tech Stocks

2 Top Artificial Intelligence Stocks to Buy This Summer

Investing in AI stocks such as AMD and Snowflake should help investors deliver outsized gains over the next four years.

Read more »

Blocks conceptualizing Canada's Tax Free Savings Account
Dividend Stocks

Why I’d Load My TFSA With This 6% Dividend Giant

A high-yield TSX stock with an impressive dividend history is an ideal holding in a TFSA.

Read more »

Start line on the highway
Investing

3 Canadian Value Stocks That Are Simply Too Cheap to Ignore Right Now

Let's look at three value stocks long-term investors may want to consider right now before they shoot higher in the…

Read more »

A shopper makes purchases from an online store.
Investing

Best Stock to Buy Right Now: Shopify vs Lightspeed Commerce?

Let’s examine Shopity and LSPD to determine a better growth stock to buy right now.

Read more »

concept of real estate evaluation
Dividend Stocks

Why the Market Should Stop Hating on This Reliable REIT

You can get a lot of dividend income with an investment in Northwest Healthcare Properties REIT (TSX:NWH.UN).

Read more »

Lights glow in a cityscape at night.
Investing

What Are the Best REITs to Buy Now?

CT REIT (TSX:CRT.UN) remains one of my favourite REITs to consider picking up this year.

Read more »