Rivian Stock Tanks on Share Offering but One Trader Holds Firm
Rivian shares sold off hard after a new share offering, but options trader Mike Khouw isn't flinching on his existing position.
Rivian just handed bears a gift. The EV maker's stock took a sharp hit after announcing a share offering — the kind of dilution move that sends retail investors scrambling for the exits. When a company needs fresh capital and taps equity markets, it's rarely a bullish signal in the short term.
But not everyone is running. Trader Mike Khouw revisited his Rivian trade publicly after the selloff, and he's not backing down. That kind of conviction after a gap-down deserves attention. Either he sees something the crowd is missing, or he's doubling down on a thesis that hasn't broken yet.
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Share offerings create instant headwinds. More shares in the float means existing holders get diluted, and the price typically adjusts to reflect that new supply. For Rivian, a company still burning cash as it scales production, tapping equity markets is a necessary evil — but it stings stockholders every time.
The tradeable angle here is simple: when a high-profile options trader refuses to bail after a dilution-driven drop, watch the implied volatility. Post-offering volatility can create opportunities on both sides, especially if the broader EV sector holds its ground. Khouw's resolve signals that the longer-term bull case — ramping deliveries, Amazon partnership, improving margins — remains intact in at least one experienced player's mind.
Don't mistake stubbornness for stupidity. If you're watching Rivian from the sidelines, this is the kind of moment where risk-reward setups start getting interesting. Continue reading at US Top News and Analysis.
