Upcoming week is most probably the important one for Alibaba Group Holding Ltd (NYSE:BABA), since 180 day post IPO lockup expiration will push for a 437 million or 18% of company shares to be sold publicly. Generally lockup expiration might affect the stock prices negatively, but what can one expect from Alibaba Group Holding Ltd (NYSE:BABA)? Meanwhile, ‘Fast Money’ traders Tim Seymour, Steve Grasso and Brian Kelly talked on CNBC about which stock they would prefer among Amazon.com, Inc. (NASDAQ:AMZN) and Alibaba Group Holding Ltd (NYSE:BABA).
Amazon.com, Inc. (NASDAQ:AMZN) had a very good 2015 so far, with stock prices going up by 20%. Seymour feels that if Alibaba Group Holding Ltd (NYSE:BABA) stock was trading $20 higher the investors would have seen a lot of money. He said that it all depends on whether the investors believe in Alibaba Group Holding Ltd (NYSE:BABA) or not.
“If I listen to the management now and I am long the company (Alibaba) and it has traded below key level that I think is around $84, but I am not throwing it out the window ahead of this, because I listen to the management and I listen to the number of management conferences and notes from the street. Deutsche bank has a not out a couple of days ago saying these guys remain extremely confident on the long term nature of their business and at 40 times these guys are giving the best growth and to me the most secured way to play the consumption growth in China,” Seymour said.
In addition to the lock up expiration next week, Alibaba Group Holding Ltd (NYSE:BABA) will face another lock up expiration in September, when they might sell around 1.6 billion shares. Grasso pointed out that generally after such a lock up expiration, stock prices fall off and take forever to recover. He added that Alibaba Group Holding Ltd (NYSE:BABA) ripped away the limelight from Amazon.com, Inc. (NASDAQ:AMZN), but he feels that Amazon.com, Inc. (NASDAQ:AMZN) has blown the roof at the moment and is currently trading at $370. He thinks that it’s a big move up from a $340 which it was trading at almost a month and a half ago. He said that he would rather Amazon.com, Inc. (NASDAQ:AMZN) stock than Alibaba Group Holding Ltd (NYSE:BABA).
Kelly pointed out that $80 is the bailout point and if the stock goes below that point, he thinks that the investors should take the profit if it is there and get out of the stock.
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