Young men walk past the corporate logo at the headquarters compound of Alibaba Group in Hangzhou in eastern China's Zhejiang province in this May 21, 2012 file photo.The Associated Press
Globe editors have posted this research report with permission of CMC Markets. This should not be construed as an endorsement of the report's recommendations. For more on The Globe's disclaimers please read here. The following is excerpted from the report:
The long-awaited debut of Alibaba as a publicly traded company is nearly upon us. While the IPO has attracted a lot of media attention due to its size and strong growth, the big test now will be to see if its shares can sustain the attention in a crowded marketplace for investment and trading dollars.
Trading in newly public companies has historically been mixed as the companies build a financial track record. Alibaba may have a different experience because Yahoo's ownership stake represents a significant portion in its overall corporate value. Trading in YHOO shares has included a valuation of Yahoo's Alibaba stake.
Since Alibaba does not arrive with a completely clean slate to start from, it may not see the explosive opening days of other big name technology IPO's. Traders' knowledge of and experience with the company also means that it may avoid the post-IPO letdowns, potholes and disappointments that have impacted previous big name debuts as well.
To get an idea of how Alibaba may perform out of the gate, it's useful to look at how previous American and Chinese technology IPOs have performed after opening day and how Alibaba's comparables have been trading lately.
Read the full report here.
Read other research reports here.