Weibo’s entry into the United States stock market started with a stumble, rather than a bang. The company neglected to sell the entirety of the 20 million shares it planned to sell leading up to its IPO. Instead, it only sold 16.8 million of them at $17 a share, the low end of its planned $17 – $19 price. Then, its stock opened below its planned price, at $16.26 a share.
Those stumbles didn’t prevent Sina Weibo from pushing through to have a good day however, by the end of trading yesterday, it was up 19 percent from its IPO, sitting at $20.24 a share. From its intial offering, Sina Weibo raised $286 million from its initial release of shares.
Once trading started, Weibo, which is trading under the symbol “WB” immediately began making up for its early stumbles. Within minutes of the opening bell, the stock had already jumped ten percent according to Forbes.
While $286 million is nothing to scoff at, many expected Weibo to do much better, with some estimates running into the $400 million range.
While I have made my feelings on Weibo as a long term investment clear, there is no doubting that the company is clearly a force in the social media market. Weibo is said to have 143 million monthly users. Meanwhile Twitter, the company most often compared to Weibo (often for inaccurate reasoning, but sometimes correctly) 241 million monthly active users. Weibo’s performance sets its total market value at $3.4 billion. When compared to Twitter’s current evaluation of $24.5 billion, it becomes clear that investors are not seeing anything close to a one-to-one ratio of the value of each site’s monthly active users.
Alibaba, Sina Weibo’s chief competition in many areas, is expected to be the next Chinese tech company to offer an IPO.