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- Cathie Wood reportedly said at a conference on Wednesday that Ark Invest would not buy Rivian stock due to its "rich" valuation, according to CNBC.
- The comments came on the same day Rivian went public and hit a valuation of more than $100 billion.
- Rivian has yet to generate significant revenue and expects to lose more than $1 billion in the third quarter.
Cathie Wood's Ark Invest isn't buying into the Rivian hype due to its "rich" valuation, according to comments she reportedly made at a conference on Wednesday.
"Josh Brown tells us that Cathie told him that the [Rivian] valuation was even too rich for her," CNBC's Scott Wapner said on Wednesday, the same day Rivian went public and hit a valuation of as much as $120 billion on a fully diluted basis.
That makes Rivian more valuable than legacy automakers like Ford and General Motors, despite the fact that the EV startup expects to generate $1.28 billion in losses on just $1 million in revenue in the third quarter.
And while Rivian has more than 50,000 pre-orders for its luxury electric trucks that start at about $70,000, the company is reportedly delaying the delivery of those vehicles to early 2022 due to supply chain and quality issues.
The comments from Wood came before Rivian's first public trades this afternoon, when the company was valued closer to $76 billion based on its IPO price of $78 per share. Despite her reluctance to buy Rivian, early investors like Amazon, Ford, and T. Rowe Price made billions off the public offering.
Wood's stance came as a surprise to many, given that the founder of Ark Invest has made a name for herself by betting on highly valued technology firms that are still in the early stages of generating a consistent stream of profits.
Tesla is the most well-known example, but Ark has also invested in air-taxi firm Blade and another EV company named Workhorse, both of which were not profitable at the time of Ark's investment.
The underlying holdings of the Ark Disruptive Innovation ETF have an average price-to-earnings multiple of 37x, according to data from Morningstar, well ahead of the S&P 500's forward price-to-earnings multiple of 21x.