Reddit’s shares opened 38% above the initial public offering price in their debut on the New York Stock Exchange on Thursday, valuing the social media platform at $8.87 billion.
Reddit’s shares opened 38% above the initial public offering price in their debut on the New York Stock Exchange on Thursday, valuing the social media platform at $8.87 billion.
The San Francisco-based company priced its IPO at the top end of the $31 to $34 range.
The IPO valued Reddit at $6.4 billion, while the company and its selling shareholders raised $748 million.
Reddit’s long-awaited entry as a publicly traded company has been in the works for more than two years.
It confidentially filed for an IPO in Dec. 2021, but the stock rout due to the Federal Reserve’s quantitative tightening led to a delay.
The eyeball-grabbing debut will be a major test of the IPO market, where investors are seeing some green shoots, thanks to increasing bets of a soft landing.
“If Reddit trades poorly, it will cast a shadow over the IPO market.
Many companies will hit pause on their IPO initiatives,” said Julian Klymochko, CEO of alternative investment solutions firm Accelerate Financial Technologies.
Shares opened at $47 each versus the IPO price of $34 each.Risky retail allocation
Reddit’s popularity rose to new heights during the “meme-stock” saga of 2021 in which a group of retail investors collaborated on its forum “wallstreetbets” to buy shares of highly shorted companies like GameStop.
