Alibaba to price shares in a range of $60-66....

[njfan47]

Just announced today through sources on Wall Street. Prediction: first trade available to the public will be in the $80-90 range and it might close on day one, or shortly thereafter, at over $100 share. Longer term (2-3 years), it will be over $200 share.

 

[roxychknpoxy]

NJ -


I enjoy the info ... do you think the market is getting ahead of itself. I guess I still have the memories of '99?? Had a fair share of IPO action then and the spikes were simply ridiculous. I realize the market has some leg in it but I think there is some hollow marks in the fundamentals. Hard to complain on this run ... I will definitely do some homework on this. Thanks

 

[njfan47]

Roxy, after the jobs report this morning, I was prepared for a rough day, but somehow the market turned around. Based on earnings and rates, I don't think the market is getting ahead of itself. There could be a small pullback at any time, but the peak is not near, at least not in the next 4-6 months, based on some key indicators, including the advance/decline line of operating companies (excluding ETF's, John Nuveen open end funds, etc.).

There is the chance that the size of the Alibaba offering will pull money out of some stocks (Amazon could be a candidate), but, as long as third quarter earnings are good, things should continue upward.

The difference between now and 1999 is that the tech IPO's are profitable companies. Alibaba is much further along than Facebook and Twitter at the time of their IPO's. In round numbers, Alibaba has $8 billion in sales and almost $4 billion in net profits. And it's growing fast. I was able to get shares through SharesPost back in April for $55. Let me know if you want me to check on whether they still have any.
This post was edited on 9/7 12:08 AM by njfan47

 

[roxychknpoxy]

I'd be willing to take a serious look. Had FB pushed at me and still to this day - even at current,price, being told it could double Ina year? But, I have reservations - thanks for info !!

 

[njfan47]

I will make a call tomorrow. Facebook at current levels ($77.26) has a good shot at $100 by the end of the year or in the first half of 2015.

 

[njfan47]

Roxy, it looks like it is going to be difficult to get additional shares of Alibaba. I will let you know if anything changes over the next week.

September 18 is the expected offer date and additional share availability will apparently depend on how the road show goes. Today, the road show started in New York and it apparently went very well in terms of both the presentation and the attendance.

 

[njfan47]

Roxy, further update: just got off the phone with the company offering the shares; they said it is now too close to the offering for them to offer shares. Some sort of legal thing, apparently.

 

[roxychknpoxy]

Nj -

I'm not surprised ... The talking heads were pushing it today and I believe there is an SEC limitation on presale. I appreciate you taking time to look into it. Information and time are the two best things we have. I'll let you know if I hear anything.

 

[njfan47]

Roxy, any time for a fellow Prep parent, although I had that status for less than one year!

If Alibaba prices in the $60-66 range and if the first trade out of the blocks is in the low $70's, it should be worth buying. However, I am not sure if the above scenario will happen and it just as easily could open in the low $90's. This one is hard to handicap because the offering is so large. The company is so profitable that it could go straight to $100 within 2-3 days if the float is not too large for the public to handle. However, some companies get too greedy in the days leading up to the offering. Facebook increased the amount of shares to such a level that the offering had nowhere to go but down.

 

[roxychknpoxy]

NJ -

I agree with your sentiment ... btw, did your son play freshman ball for the year he was there? I recall a very similar situation on my son's team.

 

[njfan47]

Roxy, yes he did. #29 on the 2006 freshman team. What number was your son?

 

[roxychknpoxy]

I recall ... My son was 74 on freshmen team ... Your son was RB/LB I think and you moved I thought out west for work -CA ?? I believe you and I had some conversations on sideline ... It was 8 years ago, but I believe your sons first name started with a C ??

 

[njfan47]

Wow, it's been a long time, but I think I know who you are. Without saying your name, the team had some gatherings at your house (I brought my son and big Seth) and you had two other sons, one older and one younger? Your son played on the O-line and D-Line.

My son's name was Ian.

We were going to move to California after his sophomore year. Had both kids enrolled at Mater Dei in Orange County, but my wife got cold feet, so we ended up staying. But I did escape New Jersey in 2013 and we are now in Naples, FL.

Yeah, now I can remember your son, if memory serves correctly. He played all four years and had a really good career at SJP. Hope I didn't give out too much information!

Update: Now I know who you were thinking of - Cory. He did move out to California and played at Chaminade in Chatsworth, CA and then went to BC with Seth. I recall that your wife was a runner or maybe even a triathlete, right?
This post was edited on 9/10 7:40 PM by njfan47

 

[roxychknpoxy]

Aha - yes ... Cory and your son were players ... Tough losing them. I have one younger son. Older son at SJP played limited time on freshman team but started and played both ways soph n junior year on JV. Even at 6'3" and 268, he was stuck at OT senior year and while he did move around, Seth anchored his primary position. We did speak on sidelines ... My wife was not the triathlete, however, it felt like we were all one with the varied games and road trips. Older son finishes engineering school this year. Small world !! Hope you and your family are doing well

 

[njfan47]

Wow, I thought I had you figured out, but now I am not sure. Was your wife a runner if not a triathlete? And did you live in Bucks County? And have your own business? This is driving me nuts!

 

[roxychknpoxy]

NJ -

Live in Montco and do have my own business after multiple mergers in banking. Wife is not a triathlete - I do know who you are speaking about ... They had three boys attend Prep - middle son who played with our boys went on to great career at Johns Hopkins (3 from that team went to JH and won conference all four years) - her husband was an optometrist. Greta folks who we still stay in touch with until today.

I hope your son is well, my oldest is just finishing engineering school at Pitt. 5 year program and finished in 4.5 - thankfully. Fortunately, he was very well prepared for the distance and work load. I suspect FLA is much friendlier with the taxes?! Ironically, while not trained, I have always been active in the market.

 

[njfan47]

Thanks for the update. Does your son's first name begin with a J? I think I might at least be getting close, but who knows!

Say hello to Ed for me. He might not remember, it's been so long!

Great news on your son and impressive that he finished early. Prep has a way of preparing kids.

Ian is doing well. He lives in Utah now, but will be coming down to Naples once we start a franchise business. Florida is great- no state income tax, which can really be a burden in NJ.

Good statement on the market. College training can be a bad thing, as many of the "elite" like to teach the efficient market theory, which is a joke. By reading Barrons, Investors Business Daily (a great conservative publication), researching companies, and not believing conventional "wisdom", one can beat the market in most years after a few years (5-10!!) of figuring out how things work.

 

[roxychknpoxy]

You are correct with the J .... Add oe .... That's great that you have opportunity to be your own boss. I've looked into franchise but haven't pursued aggressively. Spent a number of years in banking and cycled through the M&A action rotating through 6 institutions. Saw a lot of good, committed people lose their jobs after 8,12, 18 years etc based simply on numbers. It used to be if you looked out for the company, you'd be looking out for yourself but that is no longer the case. It manifested a mercenarial mindset and I decided to jump out on my own - scary as hell but I've been able to stay afloat and the heavy lifting of school tuition is in the rear view mirror. Hopefully, we can catch a tailwind economically and get a decent run here.i will say hello to Ed - funny guy ... Made me sign a contract at graduation from SJP so we would stay in touch.

 

[njfan47]

Ok, now I know who you are; thanks. I give you a lot of credit for going out on your own. And best of luck to Joe. Any job offers yet?

I still work for a decent-sized company, but thankfully it is a very non-corporate atmosphere. I am able work out of my house and travel when I need/want to. And lots of drivable accounts down here in Florida, to my surprise. The franchise business will be something that we will do on the side.

With obama, it's going to be tough to get too much of a tailwind. Growth could pick up to 3% or more, but the regulation will always be there. I think that if we had a pro-business president in office, we could be in the 5% growth area, or more. All the oil drilling has been in spite of obama and the left. But it's always funny to watch them try to take credit for it.

Pretty innovative by Ed on the contract! Great idea.

 

[roxychknpoxy]

NJ -

He has had job offers but prefers to move back east. He has a concentration in health care systems so hopefully something in pharmaceutical or one of the groups or insurance co.s to start would be great. On a similar note, BC beat USC over the weekend and Seth Betancourt had a terrific game. He is starting right tackle for the team and played very well. Currently, Our Lads has him ranked 15th at that position but I believe that could change by years end. Hopefully, he continues to elevate his game. He is a great guy and always stayed humble and grounded.

 

[njfan47]

Best of luck to Joe. Sounds like he is well qualified in several areas.

I watched the whole BC-USC game and still text with Seth a little bit. I often car pooled Ian and Seth to those August practices. The kid is a beast on game day. I thought he played real well on Saturday, especially considering it's his first full year as a starter. He actually lined up at left tackle most of the time (but sometimes as a TE on the right side), but I see him as a right tackle, possibly even a right guard, in the NFL. Right now, I think he's a late round pick or a free agent, but hopefully that will change. He will have a lot of time to dedicate to the draft since he has graduated and will be done with school by December. Just needs a little more foot quickness, but he pass blocked well against USC. He will definitely be in an NFL training camp next July-August.

 

[JBinPA]

Hot IPOs recently have drifted back to the original share price sometime after the initial euphoria. I'm thinking that will happen here; would not be a buyer day one at $100.

We'll see I guess.

 

[njfan47]

Are you saying it will drift back to the IPO offer price of $66-68?

 

[JBinPA]

No, just wondering if it will; I really have no opinion on the stock. Not sure I can trust any info that comes out of Bejing or even Yahoo for that matter so I haven't followed it at all.

 

[njfan47]

I say it opens at $80-90 range, maybe even low to mid $90's and goes over $100 before long.

I was just looking to see if we could set up a bet!

 

[JBinPA]

Interesting article on what we were discussing; good luck on your shares!



Alibaba - Facebook Comparisons

 

[JBinPA]

It's BABA day; the only guy I know will be happy is Jack Ma cashing in twice on the same company. Genius or sheer luck or sheer _________________________________________ (fill in the blank)

 

[njfan47]

How's he cashing in twice?

There are a lot of happy shareholders who bought in earlier this year and earlier in the company's life.

Sheer luck to drive one's bike 40 miles to a hotel to learn English as a 12-year-old? Or to work for 15 years to put together this company before the IPO? I say genius, hard work, and ambition.

 

[JBinPA]

Didn't Jack basically take this company public before? Then private? Then public again? Or maybe I misread his history ...

 

[njfan47]

You're right, he did take it public before. I think it might have been too early for the company to be public. I don't think it was one of those type of deals that we occasionally see here where a company goes from public to private to public several times, as the owners take advantage of good market conditions.

Jack Ma is a real likeable guy. A great interview on CNBC today. He puts customers first. Instead of him ringing the opening bell at the NYSE today, he let 8 (a lucky number in China) customers ring the opening bell.

 

[JBinPA]

It basically held up better than I expected; I expected a quick run to $100 which it did, then a fairly quick dump into about 90 which it did, then a slow uphill climb most of the day and a final hour sell off. It all came to fruition except the final hour selloff.

Long term, I still think there will be better entries than today but I've been wrong before.

 

[njfan47]

JB, I think it will hit $100 in the next two weeks. $130-140 a year from now as they will have several excellent earnings reports between now and then.

 

[JBinPA]

No doubt it goes higher, I was just wondering if it would take that post IPO swoon first in the next month or so .... long term, higher.

 

[njfan47]

JB, based on this weekend's information you could be right. The insiders have decided to sell additional shares, often called the over-allotment in IPO's. This amounts to another 40 some-odd million shares, so, with that additional supply on the market, the stock could drop this week. Now, I can see the start of a correction, based on recent events.

 

[JBinPA]

That's to be expected; any decent IPO, the underwriters will almost always exercise their full options. In this case I think I read 48 million additional shares.

There's rarely a case that one absolutely must buy an IPO first day unless you're just day trading or doing a quick flip. Better entries usually come if one is patient. No guarantees either way.

If the street begins to believe that Friday and today are the highs for the near term, you could see selling pick up this afternoon.

 

[njfan47]

Good points. Yes, the afternoon will be a good indicator today of the short-term direction of the market. We might see some buying early in the afternoon, so the 2-4 or 3-4 PM timefame will be interesting. I say buy Gilead if it drops below $104.

My only concern is where Alibaba is at in 9 months; had to agree to a nine-month lockup in order to be able to buy back in April.

 

[JBinPA]

9 months, you'll be fine!

 

[njfan47]

Yes, I think so. Hoping for $130 by then.

 

[JBinPA]

NJ, what are your thoughts on BABA here at 115? I think lower entries are coming but I've been wrong on this one so far.

Are lockups going to be an issue on this one? Do you know when the first ones hit?
This post was edited on 11/13 2:14 PM by JBinPA

 

[njfan47]

At $115, it might be a little high. It would be great if it pulled back, because it sure did go from the $82 low in mid-October to $120 on 11/13/14.

Lockups probably will be an issue, but mostly short-term volatility would be the only by-product. My guess is that the first ones hit in six months. Mine hits in nine months. But, if you think about it, most people who have nine-month lockups should hang on for another three months to gain the 20% long-term tax rate. So, maybe 9/21/15 (a Monday) will be interesting.

But, if someone is going to hold until 9/21/15, they might as well hold until 1/4/16 to avoid the tax bill until 4/15/17, postponing it for 15 months. Of course, all of this is valid only if the story is unchanged!
This post was edited on 11/15 2:37 PM by njfan47