After a Blockbuster 2021, Analyst Says EV Stocks Could See Some Cooling Off This Year

Some of the electric vehicle company stocks are likely to cool off this year after a tremendous 2021, Loup Ventures Managing Partner Doug Clinton said Tuesday.

What Happened: Clinton said electric vehicles are the future of transportation and all the news around them is directionally positive and the hype is not surprising.

The analyst added he believes the number of suppliers in the EV value chain got “marked up” quickly and many of them priced in a lot of future value.

The Rivian Example: The analyst cited the high valuation that Rivian Automotive Inc RIVN secured last year immediately after getting listed in November. Rivian’s valuation soared past those of legacy automakers General Motors Co GM and Ford Motor Co F. 

See Also: Tesla Can End Up Being The 'iPhone' Of The EV Industry And It's 'Show Me Year' For Ford, Rivian, Lucid: Gene Munster

Rivian said on Monday it fell short of its target of making 1,200 electric vehicles in 2021. The company last month reported a steep quarterly loss in its first earnings report since going public in November. Late last month CEO RJ Scaringe said the company is delaying deliveries of its 400-mile R1T pickup truck to 2023.

“The right way to think about a stock price is that a business generates some kind of cash flow. That justifies the current stock price you know if you discount that cash back to the present,” Clinton said.

As per the analyst, 2022 is setting up to be the year where investors will gain a greater appreciation of the EV supply chain.

“I think the news cycle is part and parcel of the hype …and it points to maybe you know cooling off at least for now in some of the stock prices we're seeing in the EV space.”

Price Action: Rivian shares closed 2.6% higher at $83.5 a share on Tuesday. The stock is already down about 19% so far this year.