The Rivian IPO is here; we are on the eve of it beginning to trade. In this video, I’m
gonna give you an update, with details on the Rivian IPO date, pricing, valuation and
how you can get Rivian stock for yourself. And if you watch to the end, I’ll give you
some details of some additional Rivian coverage that I have planned for the channel. If you’ve
been waiting for Rivian to go public and are looking to buy some shares, this video is
for you. Welcome to Healthy, Wealthy, and Wise, your
channel for DIY investing information. I’m Kevin and today, I want to follow up on my
last week’s video on the Rivian IPO. In that video, I shared my analysis of the company
and my personal thoughts on if buying Rivian stock makes sense. If you saw it, don’t
worry, I’m not going to repeat all of that today, but if you haven’t seen that video,
you might find it helpful to check it out after you watch this one; I’ll post a link
for you in the description. Today, we’re going to focus more on the actual nuts and
bolts of the IPO itself, including when it will start to trade, the valuation, the pricing
of the IPO shares, and who qualifies to possibly be able to get those shares at the IPO price.
And for those of you who want to buy Rivian stock, but are new to investing in IPOs, I’ll
give you some important information to know about IPOs in general and apply it to Rivian.
As we get started today, there is one thing I do want to ask you guys from the last video,
because I didn’t get many responses and because I’m really curious about this. And
that is just looking at the vehicles, not the stock or the company, which truck do you
personally prefer the look of, the Rivian R1T which is on the top of the screen, or
the Tesla Cybertruck? Now I already told you that I prefer the look of the Rivian, because
I like the traditional truck look it has…but I also know I’m older than a lot of you,
so I’m interested in knowing which one you like more? And maybe to learn if I’m starting
to become out of touch with what’s in. So please, take a second or two and let me know
which one you prefer in the comments. I think it might be interesting to see which truck
has more interest and if we get enough responses, maybe get an idea which truck might end up
having a higher demand, which would be a good thing to know from an investing perspective.
Alright, so as I record this, Rivian’s IPO hasn’t happened yet, but it will soon, very
soon. If fact, we expect the IPO to happen later today, which is, as I record this, is
Tuesday, November 9th. Now for those of you new to IPOs, this is not where you can publicly
trade for the stock, the actual IPO or initial public offering is traditionally where institutional
investors and bankers buy IPO shares at a set price determined by the company and its
underwriters based on demand. It’s usually hard if not impossible for retail investors
like you and me to be able to buy shares of a hot IPO like Rivian’s at the IPO price,
but in this case, Rivian did allow for some allotments that could be available to retail
investors. So who among us could possibly qualify to buy Rivian IPO shares? Well one
way for someone to get shares is if you’re a SoFi customer, a company that I previously
covered on the channel when they were a SPAC and, if you were with me back then, you might
remember I also shared the news of them announcing their plans to begin offering IPOs in a video
on the day that the news broke earlier this year. In Rivian’s IPO prospectus, they informed
us that they made an agreement to offer up to 0.4% of the IPO shares of Rivian stock
to retail investors through SoFi. So you have to be a SoFi customer, and if you are, you
potentially could get an allotment of shares based on their process of how they distribute
them. Since Rivian’s IPO includes 135 million shares of stock, that potentially gives SoFi
up to about 540,000 shares to distribute through its program.
Now another way to possibly get IPO shares is through a directed share program that is
only eligible to U.S. customers who had standing preorders as of September 30, 2021; since
their public filing didn’t come out until October, there’s no way that the average
person would’ve know this beforehand. To meet that qualification, the customer would’ve
had to either have an active eligible preorder or have accepted delivery of their preordered
vehicle. They also offer this program to directors, officers or employees of the company...so
if you work for the company, you probably would already know this.
So basically, unless you’re in one of those situations, you probably won’t be able to
buy any shares until Rivian stock starts to trade on the public market. But before I jump
ahead to when that happens, let’s talk about the latest pricing range that Rivian expects
to price their shares at the IPO. As of their 3rd amended filing that came out last Friday,
Rivian is now expecting to price their shares between 72 and 74 dollars, which is up over
22% higher from the 57 to 62 dollar range that I mentioned in the analysis video last
week. And keep in mind, even this new price is not a guarantee of where it will sell,
but just an expected or predicted range based on input from their underwriters of the stock
and feedback they received during their roadshow, which is basically where the company provides
presentations and information to drum up interest in potential investors. So the shares could
actually sell outside of that range, either higher than 74 dollars or lower than 72 dollars.
And depending on the interest, they could also decide to sell more OR less shares of
their stock than what they plan to sell, which is called upsizing when they sell more, or
downsizing when they sell less…which again, can happen for any IPO. For the Rivian stock
offering, they are expecting to sell, as I had just mentioned a minute ago, 135 million
shares. With the amount of interest there has been for a Rivian IPO, which again, we’ve
already seen them up their expected pricing by over 20%, I don’t expect for them to
downsize, but would not be surprised at all if they upsized their offering. When I get
the details of the actual pricing of Rivian IPO shares, I’ll put out a community post
to keep you updated, so definitely keep your notification bell turned on so you can see it
as soon as I share the information. Because I know these posts can get lost in your feed,
I’ll also post an update on Instagram; if you don’t follow me there, you can find
me by using the link I have in the description. Now regardless, whatever price the shares
are actually sold at, remember that the price is just the Rivian IPO price, not the price
you necessarily will be able to buy it for on the open market. Before I get more on how you
can buy Rivian shares on the market, let’s talk about what the new range means for Rivian’s
valuation. If Rivian stock hypothetically is priced at the middle of the range at $73,
which again, we won’t know until the actual IPO, but if they do price at $73, the company
will raise just under 9.9 billion dollars and be valued at just under 70 billion dollars.
More than Honda and within striking distance of Ford whose now up to around 80 billion
dollars with the latest run in their stock and GM who is around 86 billion dollars. And
they’ve delivered under 200 cars to date, wow. It just seems crazy, doesn’t it? It’s
all about the future with this company. Now on the other hand, they’re way behind Tesla
and their now over 1 trillion-dollar market cap. Which also seems crazy, but investors
love both of these hot EV companies. Alright so let’s now talk about how you
can get your hands on the stock. Now barring something crazy happening, the IPO will price
today, and then the stock will be listed on the Nasdaq under the ticker symbol RIVN and
start publicly trading tomorrow, Wednesday, November 10th. So where to put an order
in for it? Any brokerage or trading platform in the US will allow you to buy Rivian Stock.
Now if you’re not in the US, which I know many of you are not, you would need to be
dealing with a brokerage that has access to the US markets to be able to buy shares; so
if you don’t have that access, you’re probably out of luck.
Now a lot of you guys in the past have asked me if you can trade new IPOs on Robinhood,
so I’ll tell you upfront, you should be able to get some RIVN shares on the app. Just
keep in mind that the shares you’ll be able to get will be ones that start to trade publicly,
so don’t get confused with their new IPO Access program; that program is only for IPO
shares priced at the IPO price and Rivian did not announce an allotment to Robinhood,
only SoFi received that, as I had mentioned earlier.
So now let’s talk about when it will start to trade. We already said it’ll start to
trade on the Wednesday the 10th, but keep in mind with most IPOs, particularly the big
ones, they don’t start trading at the opening bell at 9:30 eastern. They like to do it later
where they can get all the attention and promotion on CNBC to themselves by doing it after the
market has already opened. Upfront, I don’t know exactly when the stock will start to
trade, nobody at this point could tell you that for sure, but most IPOs don’t start
trading until after 11, and sometimes not even up until after 1 o’clock PM, although
it’s usually before that. To help you guys out, I plan to put out another community post
when Rivian stock begins to trade, so again have that notification bell on so you see
it as soon as I post it. And that reminds me of another thing for some
of you to be aware of, for some platforms, the ticker symbol sometimes isn’t available
until the day the stock begins to trade and sometimes not even first thing in the morning.
So if you type in RIVN and don’t see the stock showing up, just keep in mind that they
might not have it set up yet in their system. Now if the stock is trading and you still
don’t see it as being available, then your brokerage or trading platform has a problem!
Now this gets us to the point where Rivian stock will begin to trade. And if you’ve
followed IPOs in the past, you know that the IPO price is not where the stock will open
on the secondary markets. Sometimes not even close. Remember Snowflake? How about Airbnb?
Or DoorDash? All traded well above their IPO price, which isn’t necessarily a good thing
for the actual companies themselves, it actually means those companies left money on the table.
That’s a big reason some companies have decided to go the direct listing route. I
don’t want to get off track here, but if you’d like to learn more about IPOs and
why some companies decide to take the direct listing route, I’ll link a video for you
in the description. So back to Rivian, let’s again assume the IPO
is priced at the midpoint of the range and sells at $73. Once trading begins the day
after the IPO, which is what typically happens, the shares will trade at the price someone
else is willing to buy them, as well as the price someone else is willing to sell them at.
So you might be surprised to see them trade at a much higher number; that’s just the
way it goes for IPOs and that’s why it’s more difficult for retail investors who
don’t get that IPO set price. So knowing the uncertainty of how the stock will trade,
if you’re putting in an order, think about the top price per share you’re willing to
pay for Rivian stock and then I would recommend you put in a limit order at that price so
you cap at how much you spend per share; if you put in a straight market order and the
stock doubles out of the gate, which can happen, you might find yourself putting in a lot more
money than you ever expected. Now you never know, and I can’t predict this, but there
often is a pullback for a lot of IPOs either later in the first day or sometime during
the first couple of weeks, so you could choose to not buy on day 1 if it comes out priced
a lot higher than you expected. Whatever the case, I would suggest that you buy the stock
based on some type of plan that you’ve come up with beforehand and not just your emotions
to get it take over in the heat of the trading frenzy; that’s usually a recipe for overpaying.
So for fun, I’d love to hear from everyone where they think the stock will trade on the
first day, so let me know at what price you think the stock will open up at; of course
you have to put it in the comments BEFORE it starts to trade. The winner will get a
new R1T on me…no, of course not, I wish I had one to give away! But I will give the
winner a shout out…and not just any shout out, but a solid, you-were-better-than-the-rest-of-us
shoutout. I might either do this on a post Rivian IPO video or, as I’ve been thinking
about this, possibly on a livestream; it’s been awhile since I’ve done one so I might
just have to pull one together. If I do, and I’d like to do it on Wednesday evening after
the stock closes its first day, I’ll have to see if I can pull it off as far as time.
But if I can, I’ll post a time for you guys so you can hopefully join me live.
Okay, between this video and my analysis video, I think that should just about get you ready
for Rivian’s IPO. Hopefully you found both of them helpful, and if you did, please push
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good luck in trading…and until next time, have a great day!