Why Rivian And Palantir Are Falling In The Stock Market Drop On Monday

Investors are dealing with a change in market mood that many have not seen before. For years, the mentality on Wall Street has been that when stock prices go down, it’s a good time to buy. However, this approach did not pay off as quickly as it did during most of the 2000s, leaving many market participants unsure of what to do. This helped extend losses in the major market indices that continued on Monday morning. As of 7:30 AM, futures contracts will be shown on Dow Jones Industrial Average (^ DJI -1.50%) And decreased 541 points to 32.268 points. Standard & Poor’s 500 (^ GSPC -1.72%) Futures fell 82 points to 4,038 while Nasdaq Composite (^ IXIC -1.92%) Futures fell 312 points to 12,384.

A couple of individual stocks have emerged with larger declines than the market as a whole. Electric vehicle specialist shares decline Rivian Cars (countryside -14.36%) It had little to do with core business performance, but nonetheless it severely impacted shareholders. at the same time, Palantir . techniques (PLTR -18.16%) It reported its latest financial results, and its investors didn’t find everything they wanted to see in the report. You will learn more about both companies below.

Selling pressure on Rivian?

Shares of Rivian Automotive were down nearly 16% in premarket trading on Monday. This news came as ordinary investors were pondering what those who entered the ground floor to invest in the electric truck specialist might do with their stocks.

Image source: Rivian Automotive.

Rivian had an initial public offering (IPO) in November 2021, and was among the first investors Amazon And Ford Motor Company, and both got double proportional shares in the company. As often happens with IPOs, these and other early investors were subject to lockout provisions that prevented them from selling shares immediately once Rivian went public.

With that, the six-month shutdown ended over the weekend, and reports emerged that Ford immediately sought to sell about 8 million shares of the more than 100 million shares Rivian held. With such large blocks of equity, it is usual for investment bankers to ask sellers to accept a discount, and that appears to be the case here. It’s also possible that Ford isn’t the only seller of the shares, especially given the additional downward pressure on the stock.

Rivian’s rise and fall has been a pain for shareholders, and it has had implications for the financial results that Ford and Amazon have published since their IPO. If existing major investors are already divesting portions of their stakes at current levels, it calls into question their convictions regarding Rivian’s ability to stand out from its competitors.

Palantir deals with disappointment

Meanwhile, shares of Palantir Technologies fell 13% in pre-market trading on Monday morning. The data analytics company reported its latest financial results before the market opened, and investors weren’t satisfied with what they saw.

Palantir’s first-quarter results continue to show significant growth. Total revenue increased 31% year over year to $446 million, with sales from the business side of its business up 54% from last year’s levels. Government-related revenue is only 16% higher than it was 12 months ago, but Palantir saw a significant influx of customers, with customer numbers growing 86%.

From a bottom-line standpoint, Palantir remains on low alert. The company lost $101 million for the quarter, or $0.05 per share, and even after accounting for unusual items, adjusted earnings were just $0.02 per share.

Palantir stock has been very short on high-growth technology stocks in general, and today’s movement only added to the negative sentiment around the stock. Despite the potential for further growth in the future, investors are focusing more on the short-term factors driving stock prices down again in Blantyre.

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