Alibaba surges past Facebook in storming stockmarket debut

Alibaba surges past Facebook in storming stockmarket debut

Chinese e-commerce giant Alibaba surpassed Facebook by market capitalisation on its first day as a public company right from the minute it started trading and closed with a valuation of more than US$231 billion.

Alibaba surged 38 per cent above its initial offering price to close at US$93.89 in New York on Friday. The Chinese e-commerce company, which began the day with a value of US$228.5 billion, now trails only Google, Apple and Microsoft in size among US-traded technology companies. Facebook passed US$200 billion in market value earlier this month and is worth US$201.6 billion as of Friday’s close.

Alibaba’s public market debut contrasts with Facebook’s May 2012 sale. Facebook, which was valued at US$104 billion at its IPO, lost half that in the following months, and the stock took more than a year to close above its IPO price. While Alibaba has risks related to corporate governance and the Chinese government’s unpredictability, that hasn’t stopped investors, said Jeff Sica, chief investment officer at Sica Wealth Management.

“There is much more of an ignorance-is-bliss attitude, there’s much more of a feeding frenzy where investors are afraid to miss out on the next big thing,” said Sica, whose fund manages more than US$1 billion. “There’s been hunger built up in the market for Alibaba and they’re ignoring the fact that there are a lot of negative variables.”

Facebook, the world’s largest social networking site, marked its debut on the Nasdaq exchange, where it was plagued with technical issues on top of investor scepticism about the company’s strategy for making money via advertising on mobile devices.

Facebook’s ascent to US$200 billion came as it built its business model for advertising on handheld devices. Now the company gets more than half of its ad revenue from mobile phones, compared to almost nothing at the time of its IPO.

Alibaba’s US$21.8 billion sale was the biggest-ever IPO for a technology company, buoyed by growth in China’s e-commerce market. With an IPO price of US$68 a share, Alibaba was valued at 29 times expected earnings for the year to March – below multiples fetched by Chinese and US rivals including Tencent Holdings, Baidu, and Amazon.com. Analysts forecast that Alibaba’s earnings will grow 50 per cent in fiscal 2015 from the previous 12 months.

Another big winner on Friday was Yahoo, which is making amends for years of blundering with one smart move: an early investment in Alibaba.

Yahoo is in line to make US$8.3 billion to US$9.5 billion from the initial public offering, depending on whether investment bankers exercise their right within the next month to buy additional stock in the deal.

The pay-off supplements the US$7.6 billion jackpot that Yahoo collected two years ago after selling another chunk of its Alibaba holdings and reworking a licensing agreement with the company.

Additional reporting by Associated Press

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Robert Chaen

Global CEO-Founder of ChangeU and Movsha Movers & Shakers, Hero-CEO Whisperer, Writer, The #1 Alpha Change Expert, Father of Asian FireWalking Robert Chaen is an International Keynote Speaker, writer, researcher, and corp games designer. He is famously known to be the “Hero-CEO Whisperer”, 1-on1 coaching with many CEOs and Celebrities for corporate strategies, staff & office political issues, personal branding, and even public figure OSHA safety drilling called Drager Defense. He has transformed CEOs and managers in Coca-Cola China, TVB Hong Kong, Cathay Pacific, Hong Kong Airport Services, VADS, TM, Public Bank, Auditor General's Office Maldives, etc. He is the prolific creator and online Author of innovative management tools such as DragonCEO, Diamond Leader, Papillon Personal Effectiveness, OSHA Drager Defense, KPI Bank, etc. He is also the Founder of Movsha, an international networking with monthly mingles with MOVers & SHAkers, Angels, Entrepreneurs, CEOs, Celebrities, HR-PR-CSR, HODs, and the Most Influential IDEA people. ​Chaen is widely considered as one of the top International Platform Keynote Speakers for Resorts World Genting Senior Management Conference (Manila), 7-Eleven HK, Samsung, Coca-Cola China Mini-MBA @Tsing Hua University, Cathay Pacific, Hong Kong Jockey Club, The Story Conference where he interviewed Datuk Kamarudin (Chairman of AirAsia) and Siti Nurhaliza. He has been widely featured in TVB, AWSJ, CNBC, SCMP, The Star, and Sin Chew. As “The Father of Asian FireWalking”, he coached TVB celebrities (Ekin Cheng Yee-Kin) to walk on 650°C fire; and raised HK$68M in the world’s 1st and only live TV Charity FireWalk (TVB Tung Wah Charity Show), before Tony Robbins even came to Asia. If Robert can get you to walk on 650⁰C fire, he can inspire you to be THE BEST. He champions CN-HK-EU-US Tycoons to be philanthropic, and to be angel investors to support the next generation of Jack Mas, Steve Jobs, Richard Bransons, Steven Spielbergs, or Barrack Obamas. With some slick motivational speakers with fake doctorates out there, graduates often describe Robert to be "the most credible, empowering, truthful Coach" who believe in his graduates to believe in themselves. ​However, clients have described Robert as "The #1 Cool Badass Alpha Change Expert". He has the coolest first class stature, rapport and trust from clients. He will not hesitate to tell the badass truth ever so gently because clients are paying him big bucks to reveal the truth, find solutions, persuade the hostile HODs, and align cross-teams within the organization. Originally based in Hong Kong for 20+ years, he had worked with top Branding/Ad agencies at J Walter Thompson and Leo Burnett, and was a certified FranklinCovey (7 Habits) in USA, and NLP MasterCoach (USA). His warmth is known to soften the most hardened, resistant sceptics. He will inspire your team to Go for Top 1, or to be a Dragon CEO. With boundless energies, Robert owns 15+ successful business Joint-Ventures, and created unique products under his global VC network called Chaen's Angels VC. He is deeply passionate about ChangeUTH Youth CSR, Science-Based Medicine (vs. quackery), short films and Reality TV. Touched by a personal tragedy through the loss of his HK-born Portuguese wife, co-coach and business partner, Brenda José of 18 years, Robert explores the many ways in which the spirit world is communicating with the living with real scientific studies and evidence. He gives inspiring conferences on The Secret Afterlife.

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