Yahoo Finance Live anchors Julie Hyman, Brad Smith and Brian Sozzi discuss consumer discretionary stocks, Rivian stock dropping, and Lordstown Motors’ $90 million loss.

Video Transcript

- Affect today's opening bell.

[MUSIC PLAYING]

[CHEERING]

[BELL RINGING]

And there we have it. As we talked about earlier, some of the worst performers during this turbulent period-- tech, consumer discretionary-- they are set to continue their selling today, guys.

- Yeah. If you think about some of the components that we've been tracking very closely here, especially as the markets open here on the day, I'm going to continue to watch consumer discretionary, to see just how households are thinking through their own spending habits-- where are some of those cyclical purchase on a longer term basis beyond just what you need, getting in and out of the weeks, whether that be in the fridge, or the pantry. And some of the staples in the discretionary, where they're actually moving some of those funds around, and how that could actually impact a summer vacation season as well, even, potentially.

- Well, you could see a lot of these consumer discretionary stocks might now start to be pricing in a recession seeing as the market really open sharply lower here, but let's turn now to the stocks on the move here in the early going. One stock I am watching and continue to watch-- that is Rivian.

Rivian shares have lost their charge. Shares of the electric truck maker tanking today after reports that Ford is selling 8 million of its shares at a discount. The mighty blue oval owns roughly 12% of Rivian from a stake it took before Rivian went public last year. Ford offered up a no comment to Yahoo Finance on if it is in fact selling its stake.

But, look. The market realizes that it is, in fact, probably selling its stake. Now CEO Jim Farley over at Ford, just a couple of weeks ago on the earnings call offered up no comment to, I believe, it was a JPMorgan analyst who asked, what are you going to do with this stake?

At the end of the quarter, that stake was worth $5.1 million. That was late April. Since then, you've seen Rivian shares continue to be under major pressure, down about 15% since. That was prior to this move here.

So essentially, Ford was losing money in real time. And they have no reason to continue to be exposed to this train wreck that is Rivian. It has been a horribly disappointing IPO. You have Ford that is now started to make its Ford-- it's a lightning electric pickup truck.

Sell the stake. Take those funds. Invest in your own initiatives. This move makes sense to me.

- Look at the price action right now that we're seeing on Rivian just today. And then think about that in broader context. We started off this year at $100 a share on Rivian-- right now it's sitting at about $24 a share. And ultimately is-- I mean, when we get some earnings from this company-- later on this week, the 11th, is when they're expected to announce their earnings. We'll see exactly what some of those new preorders look like, especially for the R1.

The reason that I do continue to enjoy seeing what this story is around Rivian is because of the part of the auto market that they're in. The pickup trucks can do extremely well as long as they compete. But they have to compete against, of course, the company that's dominated--

- As long as they can make them.

- --the category. And make them, right, against Ford, who's dominated that pickup truck segment for 40 years.

- Right. And they now have a direct competitor as well in the electric Ford F-150 lightning, right. So when you've got a stake in the company that's competing against you, makes sense, besides the fact that they're not doing well, that you would want to get out. Lordstown, by the way, was also out with its numbers this morning, speaking of tragic--

- --it's not a real company.

- --electric vehicle stories, yeah. So, the loss per share coming in a penny wider than estimated last quarter, the operating loss a little bit better than estimated, but still. The company is now reaffirming that it will start commercial production of its endurance in the third quarter of this year, with initial production of about 500 units, and says commercial deliveries are expected in the fourth quarter.

I didn't get a chance to dig in here yet to see what the cash position is, because that's been a question for Lordstown and some of the others. But, yeah.

- Julie, if Lordstown is around in two years, I'll get you a $50 Starbucks gift card. You heard it here on live TV.

- OK. In two years-- guys, are you marking this down, please?

- Mark it down.

- $50 Starbucks gift card. Done deal.