Publicly Listed Company, Robinhood May Be Worth Up To $35 Billion

Next week, Robinhood, the online stock broker that became entangled in this year’s meme stock craze, will go public with a market cap of up to $35 billion.

In a regulatory filing on Monday, the firm stated that it expects to price 55 million shares in its initial public offering between $38 and $42 per share. If the shares are sold at the top end of the range, it might raise $2.3 billion.

About 52.4 million shares are being offered by Robinhood. About 2.6 million shares are being offered by the company’s founders Baiju Bhatt and Vladimir Tenev, as well as Chief Financial Officer Jason Warnick. The firm will not profit from the sale of shares by its officials and founders.

To cover any overallotments, the underwriters have the option to purchase 5.5 million shares.

The IPO of Robinhood will provide investors the opportunity to acquire a large portion of a fast-growing firm that has shaken up the usually staid brokerage industry. Customers will be able to buy up to $770 million worth of the company’s stock through its platform. According to the document, the projection is predicated on a $40 per share selling price.

Meanwhile, according to Robinhood, the venture capital arm of business software firm Salesforce.com has expressed interest in purchasing up to $150 million in shares of Robinhood at the IPO price.

Since its inception in 2014, Robinhood’s prominence has compelled competitors to eliminate fees and provide applications that make trading simple, if not enjoyable.

According to the report, the Menlo Park, California-based firm had 17.7 million monthly active users as of March, with more than half of its clients being first-time investors.

Because of the popularity of meme stocks like GameStop, many of those first-time investors have started investing in Robinhood. Because of the enormous volume, the trading frenzy that ensued caused Robinhood to restrict some deals, and also garnered federal attention.

According to the report, Robinhood anticipates revenue for the April-June quarter to reach $574 million, up from $244 million a year ago. Despite this, the firm expects to lose between $487 million and $537 million in the quarter. In the same quarter last year, Robinhood made a profit of $58 million.

Revenue will be lower in the third quarter, according to the firm, due to reduced trading activity.

On July 29, the firm is anticipated to list on the stock exchange for the first time. It will be listed on the Nasdaq under the ticker symbol “HOOD.”