Market Overview

Here's How Much Investing $100 In The 2014 Alibaba IPO Would Be Worth Today

Here's How Much Investing $100 In The 2014 Alibaba IPO Would Be Worth Today

Investors who owned stocks in the 2010s generally experienced some big gains. In fact, the SPDR S&P 500 (NYSE: SPY) total return for the decade was 250.5%. But there’s no question some big-name stocks did much better than others along the way.

Alibaba’s Big Decade

One market leader of the last decade was Chinese e-commerce giant Alibaba Group Holding Ltd - ADR (NYSE: BABA).

Alibaba held the largest IPO in history at the time back in September 2014, selling IPO shares for $68 and raising $21.8 billion. Alibaba came roaring out of the gate after going public, but enthusiasm for the stock soon began to wane due to concerns over its share structure, insider selling, rising competition and rampant counterfeiting on its platforms.

In recent years, Alibaba has finally started to demonstrate that its e-commerce platforms and cloud services businesses are firing on all cylinders. Last quarter, Alibaba reported $119 billion in revenue and $72.5 billion in net income, up 39.7% and 260.5% respectively.

Alibaba reached a high of $120 within weeks of its IPO before falling back below its IPO price by late 2015. Shares hit their all-time low of $57.20 before year’s end following heavy selling related to the company’s lockup expiration.

Alibaba IPO investors were quickly back above water by early 2016, but Alibaba didn’t make a new all-time high until mid-2017. By the mid-2018, Alibaba climbed as high as $211.17, but negative headlines surrounding the negative impact of the trade war on China’s economy began to weigh on the stock.

Not coincidentally, Alibaba stock finally broke out to new all-time highs in December 2019 on news of a phase one trade deal with the U.S.

See Also: Alibaba Reports Q3 Earnings Beat, Provides Support To Fight Coronavirus

2020 And Beyond

Alibaba hit its all-time high of $231.14 in January of 2020. Unfortunately, the celebration didn’t last long as fears over the Wuhan coronavirus outbreak hit Chinese stocks hard in recent weeks.

Despite the wild ride along the way, Alibaba investors have far exceeded the returns of the S&P 500 since the IPO. In fact, $100 in Alibaba IPO shares would now be worth $314.

Looking ahead, analysts are expecting more gains from Alibaba in 2020. The average price target among the 19 analysts covering the stock is $251, suggesting 17.3% upside from current levels.


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