Boston, MA 04/23/2014 (wallstreetpr) – Weibo Corp (ADR) (NASDAQ:WB)’s shares continue to soar in the market after debuting in the recently held Initial public offering, at a share price of $17. The company’s stock is currently at a high of $23.15 despite slipping to $16.4 on earlier trading sessions. Weibo successfully sold a total of 16.8 million for a total of $286 million, an amount that inflated the company’s value to $4 billion.
Weibo Experiencing Low Growth in User Base
Weibo had initially priced its offering at between $17 and $19 a share. The range was later revised after concerns were raised on the slow growth of the company’s user base. Media freedom restrictions in China continue to greatly affect the heights that the company can climb in the market.
Some investors shied away from the offering awaiting the much publicized Alibaba IPO which owns a third of Weibo. Alibaba IPO is expected to be the biggest IPO after Facebook Inc.’s (FB) that was carried in 2013.
The biggest reason behind Weibo Corp (ADR) (NASDAQ:WB) discount in sell off can be attributed to tremors being felt in the US stock markets. Sell offs in the tech sector has already caused many tech companies to stumble in the markets. Twitter alone which is comparable to Weibo has seen its stock plunge by highs of 18% over the last month alone.
Chinese Companies Being Accepted in the U.S
Chinese companies continue to be accepted in the US Market as they continue to post impressive financial results. Tencent Holdings (TCEHY) alone which supplies internet service portals in China has already seen its revenue grow by 38% last month. Baidu, on the other hand, has registered revenue growth of 43%.
Since launching in 2009, Weibo Corp (ADR) (NASDAQ:WB) has seen its active users surge to total of 143.8 million representing 66.8% of Twitters active users. Weibo main problem at the moment lies on the stringent media regulations, as well as increased competition in China. Tencent Holdings is its biggest competitor whose app commands a total of 121 million user subscription.
