The Chinese e-commerce company Alibaba blew the doors off Wall Street when its shares flew past 47 percent in just the first 10 minutes of trading. The stock closed at 38% following its record breaking $21.8 billion initial public offering. The 30 IPOs in the US this year that raised $250 million or more, only Mobileye NV has gained more than Alibaba in its debut on the boards according to Bloomberg.
Tan Chiheng, a Boston based analyst at Granite Point Capital Inc, who also bought shares of Alibaba said, “The stock’s price jump in trading is definitely a good reward to investors who had the chance to buy. He added, “Its IPO was reasonably priced which helped drive the strong trading and price gains.
Jack Ma, the brainchild behind Alibaba that started in his apartment in Hangzhou said, “I don’t want to disappoint shareholder.” he added during a CNBC interview before stock started trading, “I want to make sure they’re making money.” Alibaba shares rose to $98.89 after being priced at $68 the high end of its original targeted range. This rally compared with the average 19 percent first day gain for Chinese IPOs in the US over the past decade according to Bloomberg.
While Alibaba’s advance was hotter than the rest of the pack it still fee a bit short of Baidu Inc’s fivefold one day surge when then China’s largest search engine hit Nasdaq stock in 2005.
Alibaba’s market capitalization was $231 billion as of Friday way past that of Facebook Inc, the worlds largest of social networks. This still trails Google In, Apple Inc, and Microsoft Corp in size regarding US traded tech firms.
Analysts and experts in trading say Alibaba has a way to go to keep performance and the public happy. Basically how they handle their administrative end of the business. This includes investor relations, phone service, and more. It appears Alibaba’s Ma has his work cut out for him in this respect to keep the stock up and performing for years to come.
Already the top shopping place that Russians use as well as Brazil, the company has no employees there and will have to get busy to expand itself in Africa, Europe, the US, and Southeast Asia. It needs to create a system that will allow it to cater to not only consumers but stockholders as well. This means developing a workforce of exceptional proportions.