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Yahoo Inc (YHOO), Alibaba Group (BABA) Would Like to See A Pop In the IPO Day: Jackson Wong

Alibaba Group seems to be in no hurry to recur to an Initial Public Offering (IPO), which has mixed feelings attached to it.  Apparently, the company’s looking to grow as large as possible in its local medium, then predate on all its competition worldwide. Jackson Wong, vice president at Tanrich Securities said on CNBC that growth can still be around 30% for the next 5 to 10 years, which is pretty solid for a business valued about $150 billion. 1

Yahoo! Inc. (NASDAQ:YHOO) has about 22.5% stake in Alibaba Group and its stock price will certainly enjoy a bump due to the upcoming IPO. It’s not clear if the effect will be a lasting one, there are no clues as to where the value target will be, but the price will be getting higher.  Yahoo! Inc. (NASDAQ:YHOO) grew almost 1% during the day to little more than $43 and looking at the graph for the last two months, it might follow the same pattern for a while. Obviously, the growth is not entirely the e-commerce company’s success, yet its contribution cannot be negligible. No wonder Alibaba Group is not in a rush to ask for money.

There’s a lot of fuss around what seems to be the biggest public offering in history, around $24 billion are planned to be raised through it, as we go further in time and somehow farther from initial price estimates. There is some fright that the deal might follow Facebook Inc (NASDAQ:FB)’s example

“I think from the sentiment they could raise the band or even increase the IPO size, but they are seriously thinking about: let it as is, because they would like to see a blockbuster IPO and also they would like to see a pop in the first day,” said Jackson Wong.

It will not do them much good if investors get nervous, but at the same time there’s actually no need for Yahoo! Inc. (NASDAQ:YHOO)’s team to start biting their nails. Alibaba Group is a large enough company not to fall short in shares like Facebook Inc (NASDAQ:FB) and as price estimates begin to fluctuate less, the market will have digested the most important information about the company thus stabilizing the price.


Disclosure: none

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