Rivian Automotive (RIVN -4.37%) stock surged this morning, rallying nearly 7.8% at one point during the first hour of trading in the day. Although the electric vehicle (EV) stock gave up some of its early gains, it was still among the few EV stocks that traded in the green around noon on Feb. 17. Barely weeks before Rivian reports its much-awaited quarterly numbers, at least two billionaire investors have revealed they bought a stake in the electric truck manufacturer. The latest revelation comes from Dan Loeb, the activist investor with a net worth of roughly $3.5 billion in 2021.
In its latest 13F regulatory filing, Loeb's hedge fund, Third Point, disclosed an ownership of 4,046,572 shares of Rivian as of Dec. 31, 2021. Its stake was valued at roughly $408 million.
You'll want to note a couple of things here.
First, Third Point bought Rivian shares in the fourth quarter of 2021, a period when the stock fell sharply. Second, Third Point didn't own any stake in Rivian before that, which means the stock's fall toward the end of 2021 likely caught Loeb's attention. That's likely the case for George Soros as well -- Soros' investment fund has also just disclosed a pretty big stake in Rivian as of Dec. 31, 2021.
Investors often see institutional buying in stocks as a positive signal, which is why Rivian stock jumped the day Soros Fund Management's filing was made public. Third Point's filing triggered further buying activity in Rivian stock.
I don't blame investors in the market for bidding Rivian stock higher Thursday morning. Rivian, after all, had lost favor with investors in recent weeks for multiple reasons, including a production shortfall and mounting losses in 2021. The market has since been cautious on the EV stock and pinning hopes on Rivian's fourth-quarter earnings call and management's views coming up on March 10. In between, the revelation that at least two billionaires see promise in Rivian stock and have bought shares has therefore turned out to be the perfect breather for investors in Rivian.
There's one crucial point investors should keep in mind here, though: Loeb and Soros bought Rivian shares in the fourth quarter of 2021, and none of us knows yet if they still own those shares or have sold them off already. Make your moves accordingly.