Daily Brief - Rivian is worth more than Ford (Nov 18, 2021)
If you pay any attention to the US stock market you might have noticed the glorious debut of Rivian, the EV company sponsored by Amazon and Ford.
Rivian has 0 revenues and a 100k electric van order by Amazon. It is worth $124bn. More than Ford at $80bn and VW’s at $137bn.
So one is tempted to call it a bubble, stay away from the stock and invest in something else.
That’s the sensible line, following hallowed value investing prescriptions that investors have taken on faith for decades now.
However, if you followed this approach for the last 10 years you are now probably underperforming the market by anywhere between 50% and 100% - depending on how badly your value stocks have done.
Bubble times can be hard for traditionally minded investors - the stocks you hate go up for years, and gather all flows leaving your “fundamental gems” in the dust.
So what to do?
Here’s two ideas:
Embrace the momentum: if you can’t beat them join them. You can find dozens of great momentum ideas each day on Toggle. Just check the Momentum filter in Explore:
Go for hard value: it’s not fair to say Value has not worked. You just need to be stricter about what constitutes Value, and focus on multi-year rock-bottom support levels on which a stock can rebound like a springboard. Just check the Value filter in Explore: