Everything You Need to Know About the Oatly IPO

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Dennis Hammer is a writer and finance nerd with six years of investing experience. He writes about personal finance for Wealthsimple. Dennis also manages his own investment portfolio and has funded several businesses in the past. Dennis holds a Bachelor's degree from the University of Connecticut.

Oatly is a unique player in the sustainable products industry with a lot of potential growth ahead of them. In this article, we’ll explain what Oatly is, why investors like it, and how to buy shares.

What is Oatly?

Oatly is a Swedish vegan milk maker that was formed in the 1990s. It produces sustainable alternatives to dairy products using oats via their patented enzyme technology.

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Most of its sales come from its oat milk, but it also produces ice cream, custard, yogurt, and cold coffee. Their flagship product is used most commonly in homes. Their “barista” version is becoming popular at restaurants, cafes, and coffee shops.

Oatly is a self-proclaimed independently run and owned company, although after nine rounds of funding, it has several private investors. Their investors include The Blackstone Group, Oprah Winfrey, and other popular players in the entertainment industry.

What is Oatly’s current market cap?

As of May 2021, Oatly’s market cap is $14.9 billion. Market cap refers to the total dollar value of a company’s outstanding shares. This includes shares owned by stockholders, private investors, and company officials. It is a reliable way to judge the value of a company’s stock.

When is the Oatly IPO taking place?

Oatly’s IPO took place on May 20, 20021. It was listed on the Nasdaq under the ticker symbol OTLY. Shares were listed at $17, but quickly rose to $22 on the first trading day. Oatly offered 65 million shares, raising $1.43 billion. According to Oatly, the capital raised will be used to fund growth and for existing investors to cash in on their holdings.

Why are people interested in buying Oatly shares?

First of all, investors like Oatly because it’s profitable. It had $200 million in revenue during 2019, which is double its previous year. Oatly has not released its 2020 sales figures yet, but the company claims that sales have skyrocketed throughout the pandemic.

Second of all, there’s growing demand for plant-based alternatives to unsustainable products. This movement is fueled by environmental concerns, namely due to the gas emissions from cattle and the caring for livestock.

Additionally, demand continues to grow for health reasons. Younger generations appreciate sustainable products that also address their health concerns. Demand for Oatly’s products has been so great that in early March, 2021, it announced it would open one of the world’s biggest plant-based dairy factories in the UK in 2023.

How can I buy shares of Oatly?

Since Oatly has already completed its IPO, shares are available to purchase. In order to trade Oatly stock, you should follow these four steps:

Step 1: Open a brokerage account

Before you can trade stocks, you must open an account with a brokerage. A broker is a financial institution that allows retail investors to buy and sell shares of stocks and other financial products.

If you already have an account with a brokerage, you can probably use it to purchase shares of Oatly, as long as it allows you to trade stocks. If you need to open a brokerage account, we recommend finding one that meets the following conditions.

  • Low commissions and fees. Make sure you understand the fee structure.

  • A simple and easy to use trading platform

  • Access to other securities and financial products in case you decide to expand your portfolio at some point in the future

Part of opening a brokerage account includes depositing funds to be used for trades. If this isn’t part of your brokerage’s onboarding process, make sure to deposit some money before moving forward.

Step 2: Decide how many shares you want

After opening your brokerage account, your next step is to decide how many shares of Oatly you’ll purchase. Fortunately, this is a simple equation. Just divide the amount you want to invest by the price of each share.

For example, if you’re willing to invest $5,000 and Oatly costs $25 per share, you can afford to buy 200 shares. ($5,000 / $25 = 200).

Like any stock, purchasing shares of Oatly comes with some risk. We hope the value of the stock continues to rise, but there’s a chance it could fall. Never invest more money than you can afford to lose. We encourage you to diversify your portfolio with different kinds of securities to reduce the risk of losing everything.

Step 3: Choose your order type

The last step before executing the trade is to decide how you’ll buy your Oatly shares. There are two ways to purchase shares. Each method will affect the total you pay for those shares.

Market order: This is an order to trade the stock at the current price when the order reaches the exchange. Once you submit the trade, you don’t have any control over the actual price at which the order is filled. Popular stocks that trade often are usually filled at prices similar to their orders, but there are no guarantees.

For example, if Oatly is currently $22 a share and you place a market order, you’ll likely pay something close to $22 (with some slight fluctuation). You might end up buying at $21.50 or $23.

Limit order: A limit order is an order to buy or sell a security at a specific price. The price you choose is the exact price you’ll pay. Purchase limit orders are only executed at the limit price or lower. Sales limit orders are executed at the limit price or higher. This method gives you control over what you buy, but there’s no guarantee when the trade will take place.

For example, if Oatly is currently trading at $22 a share and you place a limit order to purchase shares at $18 a share, your order will only be fulfilled when the price falls to $18 or less.

Step 4: Execute the trade

Now that you’ve chosen how many shares you’ll buy and the order type you’ll use to buy them, your final step is to execute the trade. This is where your brokerage account steps in. The brokerage will deduct the funds from your account and deposit the shares soon.

If the broker isn’t able to fulfill your order that day, it may leave the order open until it’s fulfilled. Other brokers cancel trades at the end of the day. Check with your broker to learn how they handle these situations.

Last Updated June 29, 2021

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