When the “smart money” talks, I listen. And right now, that smart money is betting big on a single EV stock that could unseat Tesla (TSLA).

Specifically, last quarter, two legendary hedge fund managers just picked up nearly $4 million worth of this EV stock.

The first is Ray Dalio. He’s one of the most well-respected names on Wall Street. He’s the chief investment officer of the world’s largest hedge fund, Bridgewater Associates. That fund soared 32% in the first half of this year, even as the broader markets tanked.

Bridgewater just bought about $1.6 million worth of this EV stock.

The second is David Einhorn. David’s the brain behind Greenlight Capital, one of the most revered value investment hedge funds of the past 30 years. That fund returned 26% per year over a 10-year-stretch in the late 1990s and early 2000s.

And Greenlight just bought about $1.9 million worth of this EV stock.

In other words, two of the most successful investors of our generation both recently started multi-million-dollar stakes in a small electric car stock.

Clearly this is an EV stock you need to learn about today. Fortunately, we’re here to tell you all about it.

We’re talking about Rivian (RIVN).

The Quick Rundown on Rivian

To cut to the chase, let me be clear where I stand with this EV stock.

I’m with Einhorn and Dalio. I’m a Rivian stock bull. That’s mostly because I think the company can dominate an unfilled niche in the EV industry that, at scale, will be very large.

Before I go further about why Rivian is a great EV stock to buy today, let’s first revisit its fundamentals.

Rivian is an EV startup that’s designing, manufacturing, and selling high-end electric SUVs and pick-up trucks. The company is widely considered one of the most technologically advanced and promising pure EV makers in the world today.

Rivian’s Game-Changers

Rivian just started delivering units of its first model – the R1T – in 2021.

The R1T is an electric pick-up truck that seats five, has a 54×50-inch bed and gets roughly 300 miles per charge. It can tow up to 11,000 pounds and has a 0-to-60 mph time as quick as three seconds. The interior is comprised of vegan leather, with a panoramic all-glass roof and a custom enhanced audio system.

It’s a very high-quality electric pick-up truck. And it currently starts at $73,000. Rivian delivered almost 1,000 of these trucks in 2021 and is on track to deliver more than 20,000 R1Ts this year.

Its second model is an electric SUV dubbed the R1S. It’s a large-format SUV that can comfortably seat up to seven passengers and their gear. It, too, gets roughly 300 miles of driving range on a single charge and can accelerate from 0-to-60 mph as quick as three seconds. It has all-wheel-drive capability and is outfitted with the same interior fittings as the R1T: vegan leather interior, all-glass panoramic roof, and a custom enhanced sound system.

R1S deliveries have just barely begun, with the company shipping models to employees only. Public delivery is expected to start in August or September. The starting price is $72,500.

Rivian went public in a highly-anticipated and briefly super-successful IPO last year. The stock has since struggled after a brief hot run. Today, the company is worth $30 billion. At that valuation, RIVN stock is an absolute steal.

The Long-Term Bull Thesis on This EV Stock

Long-term, we believe high-quality EV stocks are great multi-year investments. Indeed, EVs are set to grow from ~10% of car sales today to 50%-plus by 2030. As the whole industry grows 5X, the companies at the forefront of this disruption will sell lots of cars, generate lots of profits, and unlock lots of shareholder value.

Over the next five to 10 years, some of the stock market’s biggest winners will be high-quality EV stocks.

And in this realm, Rivian stock is one of our favorites. Why? Our multi-year bull thesis can be broken down into five main points:

• Leader in a strong demand niche of the burgeoning EV industry. We know that the trucking niche of the automotive market is very large with very durable and strong demand drivers. Presumably, as that portion of the auto market gets electrified, there will emerge an equally large electric truck market. Presently, there is no clear leader in that market. But Rivian has a promising early start with a fantastic first-to-market truck that has among the best specs in the industry. This electric trucking market will support multiple winners, and we’re confident Rivian will be one of them.
• Great brand equity, with strong technology and a fantastic first product. Rivian has established exceptional luxury branding and has developed leading EV battery and torque technology. These are two things that are very important for creating a great electric truck. Indeed, the R1T is probably the highest-performing electric pick-up truck in market today. And it should remain so for the foreseeable future.
• Strong early demand signals. Rivian has more than 90,000 net preorders in the U.S. and Canada for the R1S and R1T, illustrating that consumers want these cars.
• Big support and partnerships. Rivian also has a very unique and promising partnership with Amazon (AMZN). The retail giant will buy at least 100,000 electric delivery vehicles from Rivian. The extent of this partnership broadly implies that Amazon has basically picked Rivian as its “horse” in the EV race. And at scale, it will convert its entire delivery fleet into Rivian cars. That represents a huge long-term opportunity.
• A mammoth-sized balance sheet. The best thing about Rivian is that it has almost $20 billion in cash on the balance sheet. And that grants the company an almost unfair advantage over peers. Rivian plans to use basically every penny of that cash balance over the next two to three years to develop market-leading tech, secure market-leading supply deals, and establish market-leading production capacity. Rivian’s $20 billion should enable it to create an electric vehicle empire by 2025.

For those five reasons, we believe Rivian projects as one of the largest producers of EV cars by 2030. That will render it one of the most valuable auto companies in the world by then.

Our “back-of-the-napkin” math indicates that Rivian could hit the million-deliveries-per-year milestone by the late 2020s. At a $70,000 average sales price, that implies total revenues of $70 billion. Assuming a similar margin profile as Tesla (TSLA) – 30% gross margins and 20% operating margins – that would lead to $14 billion in operating profits. That’s about $10 billion in net profits after taxes.

A simple 20X price-to-earnings (P/E) multiple on that implies a potential late 2020s valuation target for Rivian of $200 billion. That’s nearly 10X the current market cap, meaning we see Rivian stock as a potential ten-bagger.

Powerful Short-Term Drivers

We think Rivian stock has multiple catalysts that could spark a significant rebound in shares over the next year.

For starters, the stock is really cheap. RIVN is basically trading at just 1X its 2025 sales estimates. If the company executes on its growth roadmap over the next few years, the stock should fly higher.

Previously, that was a big “if.” Today, it no longer is. Rivian is meeting its revised delivery and production targets even in a bad market. That’s impressive, and it should re-inject investor confidence into the company’s ability to execute over the long run.

At a macro-level, significant tailwinds are forming for the whole Electric Vehicle Revolution.

On the production side, China – where 60% of battery manufacturing is done – is moving past COVID-19 lockdowns and restarting full production capacity at many of its manufacturing plants.

On the demand side, the U.S. government just passed the biggest climate bill in the country’s history. A big part of it contains legislation to stimulate EV demand (including an extension of the EV tax credit, the elimination of a cap on the tax credit based on number of EVs sold, and the introduction of a tax credit for a used EV purchase).

On the pricing side, the industrial metals needed to make EV batteries – like lithium and cobalt – have seen their prices collapse over the past few months, after spending most of 2022 soaring. Today, industrial metal prices are broadly back to where they were throughout most of the 2010s.

Overall, we think the whole EV industry is about to heat up in a big way. Rivian will dramatically and impressively ramp production against this improving macroeconomic backdrop, and on the heels of a huge stock price decline.

That’s a powerful combination which implies huge gains ahead for Rivian stock.

The Final Word on a Winning EV Stock

We love Rivian stock as a long-term investment opportunity.

But despite its 10X upside potential and strengthening economic tailwinds, it isn’t our favorite next-gen technology stock to buy today.

That’s because our favorite stock to buy today doesn’t have 10X upside potential… but rather, 100X upside potential.

And it doesn’t have strengthening economic tailwinds… Instead, it has a potential game-changing catalyst on the horizon that could send the stock up hundreds of percent in a few days alone.

This is a stock unlike any other we’ve ever encountered in the market. In fact, it could turn into our biggest winner ever, too, very soon.

Learn more about what may be the most exciting investment opportunity in the market today.

On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.