Rivian's 25% Stock Rally Puts EV ETFs Back In Play—Time to Buy?

Electric vehicle stocks roared back Wednesday as Rivian Automotive Inc (NASDAQ:RIVN) jumped more than 25%, extending momentum from its third-quarter results. The rebound helped erase much of the prior day’s sector slump, sending EV-focused ETFs higher across the board.

Rivian’s quarterly revenue jumped 78% year-over-year to $1.56 billion, above Street estimates of $1.50 billion. Deliveries rose 32% to 13,200 units, while consolidated gross profit turned positive at $24 million, a milestone for the once loss-heavy startup. Although the company still posted a wider-than-expected loss per share, investors looked past it and instead concentrated on operational progress and a reaffirmed 2025 delivery forecast.

EV ETFs Recharge

The wider EV ETF complex also moved higher as Rivian rebounded. The KraneShares Electric Vehicles & Future Mobility ETF (NYSE:KARS) was up 1.7% while the Global X Autonomous & Electric Vehicles ETF (NASDAQ:DRIV) added 1.8%. The First Trust S-Network Future Vehicles & Tech ETF (NASDAQ:CARZ) and iShares Self-Driving EV and Tech ETF (NYSE:IDRV) rose around 1% each in early Wednesday trade.

Today's rally follows Tuesday's pullback, when EV ETFs slumped between 3% and 4% amid profit-taking and worries over rising costs and slowing demand. Analysts say Rivian's better-than-expected execution and upcoming catalysts, such as its Autonomy & AI Day in December, may have rekindled optimism in a sector that's been under pressure for much of 2025. For instance, George Gianarikas from Canaccord Genuity called Rivian's upcoming R2 launch a "game-changer" and reiterated a Buy on the stock, highlighting the broader mobility theme.

Long-Term Structural Tailwinds

Despite volatility, long-term fundamentals for the EV theme remain intact. Statista forecasts global EV market cap at $1.1 trillion by 2030, and DRIV’s aggregate P/E ratio of about 19 suggests valuations are not overly stretched for a growth-oriented ETF, meaning there’s still room for prices to run higher.

In addition, diversified exposure gives EV ETFs staying power. Funds like DRIV and IDRV hold not just the automakers but also semiconductor, battery, and autonomous tech companies, letting investors participate in the broader mobility transformation rather than bet solely on a single manufacturer like Rivian.

Momentum With A Warning

Analysts warn the road ahead remains bumpy: profitability challenges, high borrowing costs, and policy uncertainty still overhang. Dan Levy of Barclays warned that Q3 may mark "the highest" US EV market penetration for some time, noting strong growth but elevated business risks for EV makers.

Yet the surge in Rivian’s stock has given EV ETFs a light jolt, and for some investors, it is the perfect time to accumulate exposure.

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