Here's How Much Investing $1,000 In The 2014 Alibaba IPO Would Be Worth Today

Investors who owned stocks in the past five years generally experienced some big gains. In fact, the SPDR S&P 500 SPY total return since Sept. 18, 2014 is 64.2%. But there’s no question some big-name stocks did much better than others along the way.

Alibaba’s Big Debut

One market leader since its 2014 IPO is Chinese e-commerce giant Alibaba Group Holding Ltd - ADR BABA.

Alibaba was founded in 1999 and finally made the move to go public in September 2014. Alibaba was one of the highest-profile IPOs of the 2010s. The company raised $21.8 billion, making it the largest IPO in history at the time.

After selling IPO shares at $68, Alibaba shares hit the ground running, soaring up to $120 during the frenzy surrounding its IPO. However, the stock soon ran out of steam due to several major concerns.

The company’s lockup expiration and Yahoo’s spin-off of its ownership stake in the company added another 800 million shares of Alibaba stock to the market. At the same time, concerns over piracy on Alibaba’s platforms and rising competition from JD.Com Inc JD threatened to undermine extremely high market expectations.

Alibaba shares dropped to their all-time low of $57.20 in late 2015 before beginning a mutli-year ramp on the strength of impressive growth in both online sales and cloud services. Alibaba stock climbed as high as $211.13 in mid-2018 before the trade war between the U.S. and China dampened investor sentiment.

2020 And Beyond

In early 2020, a trade deal between the U.S. and China drove Alibaba to its new all-time high of $231.14.

Unfortunately, the stock has since slumped back to around $219.42 thanks to COVID-19 concerns.

However, the Alibaba IPO has still been one of the best buying opportunities of the past decade, and $1,000 worth of Alibaba IPO stock in 2014 would only be worth about $3,223 today.

Looking ahead, analysts expect more upside from Alibaba in 2020. The average price target among the 11 analysts covering the stock is $252 suggesting 15.2% upside from current levels.

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Photo credit: Andy Mitchell, Flickr