Rivian Automotive Inc RIVN shares are trading lower by 2.7% to $20.54 during Wednesday's session. Several sectors are experiencing a decline, likely due to rising Treasury yields and investors taking profits after a strong December 2023. There's also uncertainty around upcoming economic reports and Federal Reserve speeches adding to this trend.
Investors are waiting for confirmation about expected rate changes and keeping a close eye on the December meeting minutes and job-related data from the Federal Reserve.
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The Significance of Climbing Yields
Growth stocks such as Rivian rely on anticipated future cash flows to determine their value. But when interest rates rise, the discount rate used to evaluate these cash flows also increases.
This uptick in the discount rate can lower the current value of expected cash flows, impacting how investors view the worth of growth-focused stocks.
According to data from Benzinga Pro, RIVN has a 52-week high of $28.06 and a 52-week low of $11.68.
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