Jim Cramer says he is skeptical that Rivian is the subsequent Tesla and would somewhat personal Ford

CNBC’s Jim Cramer stated Monday that though electric-vehicle startup Rivian Automotive has some robust backers because it prepares to hit the general public markets, he’s skeptical will probably be the subsequent Tesla and would somewhat personal shares of Ford Motor.

“Even when all the pieces goes proper for Rivian, this trade is getting a bit of crowded in right here. When Tesla was beginning on the market was no one else,” Cramer stated on “Mad Cash.” Now, nonetheless, “Rivian’s bought Ford’s F-150 Lightning sizzling on its heels, together with GM’s electrical Hummer and even Tesla’s Cybertruck.”

With Amazon and Ford as sizable traders, Rivian priced its shares between $72 and $74 for its IPO and is prone to begin buying and selling Wednesday. “On condition that the corporate plans to supply 135 million shares, we’re speaking a few $9.85 billion fundraise, which might make this the sixth- or seventh-largest IPO in U.S. historical past,” Cramer stated.

Cramer stated he would not be shocked if Rivian’s inventory takes off even with such a excessive valuation as a result of “the folks shopping for this factor will not care about valuation.” Fairly, traders can be betting that the younger firm can scale up manufacturing and turn out to be a serious competitor within the rising EV market.

Cramer complimented Rivian for the variety of orders it is acquired for not solely its pickup truck and deliberate SUV, but additionally its main business van cope with Amazon. Moreover, the very fact a competitor like Ford is an investor in Rivian “is a large acknowledgment” of Rivian’s potential, he stated.

In the end, Cramer advised viewers that “if you happen to actually imagine in Rivian, you have bought my blessing to take a position.” Nonetheless, he added, “I might a lot favor to remain on the sidelines and get my electrical automobile publicity from Ford, which is why we personal it for the charitable belief.”

Join right here for the brand new CNBC Investing Membership publication to observe Jim Cramer‘s each transfer out there, delivered instantly in your inbox.

Disclosure: Cramer’s charitable belief owns shares of Ford and Amazon.

Leave a Reply

Your email address will not be published. Required fields are marked *