Investors are getting really excited about the upcoming Alibaba stock IPO based on what I am seeing and reading. This is clearly going to be the most publicized IPO of the year and not only get tons of media coverage here in America, but in other countries as well. I predict many prospective buyers of Alibaba stock are looking to make it their first stock purchase ever.
But First, There Was The JD.com IPO
Most Americans hadn’t heard of JD.com before it went public less than a month ago on May 22, 2014. It is another Chinese e-commerce site that is similar to Amazon in many ways (such as it still makes no money and it ships the products itself). The stock opened on the NASDAQ at $19 and closed the first day at $20.9 which equalled a 10% gain. Since then the stock has continued up to a high of $29.60 and closed today at $27.17. Obviously, this is a very good result so far for anyone who bought the stock on that first day of public trading.
What this does is confirm the public’s hunger for Chinese stocks and particularly e-commerce stocks. China is so much larger than the United States that the true potential is largely unknown. As China continues to become wealthier and the Chinese have more money to spend, investors can only dream how much companies like JD.com and Alibaba can make. Add to that the fact that everyday more Chinese become connected to the Internet or connected with faster speeds and you have a country that is going crazy for e-commerce. Investors are drooling.
The Alibaba Stock IPO Should Happen Before Summer Ends
All indications are now that Alibaba wants to go public this summer so that means within a couple of months. It won’t be long before they decide whether to be listed on the NASDAQ or NYSE and a ticker symbol is chosen. It is full steam ahead for Alibaba as the successful JD.com IPO signals that now is indeed a great time for its shares to go public.
Leading up to the IPO date, expect the number of news stories and Alibaba IPO coverage to skyrocket. This will in turn catch the interest of many first time investors and people who have never bought stock before. Not since the Facebook IPO a couple of years ago has there been such a potential to bring so many stock market beginners into the world of investing. Thats a good thing as I have alway maintained that most everyone who has money to invest should at least be partially invested in stocks.
Now lets hope that Alibaba stock doesn’t head straight down after the IPO (like FB did) or that the IPO isn’t botched like Twitter’s was. We need positive coverage so that more people learn about and grow to trust the stock market as the best way to earn a good return on their savings.