Hong Kong-based GigaCloud Technology (NASDAQ:GCT) made its debut on the Nasdaq today and it quickly skyrocketed. Wall Street had good reason to be watching GCT stock keenly. In recent months, fellow fintech companies AMTD Digital (NYSE:HKD) and Magic Empire Global (NASDAQ:MEGL) debuted and skyrocketed.
As both HKD and MEGL surged, InvestorPlace Markets Analyst Thomas Yeung traced their rise to meme stock frenzy. As he explained, a temporary meme-stock mania does not make either one a good buy. “The trick is understanding the difference between a high-potential stock and one that’s riding a wave of overoptimism,” he noted, indicating that meme stocks fell into the second category. However, that doesn’t mean that the next Hong Kong fintech IPO isn’t worth watching.
Let’s take a look at GCT stock’s first trading day and what investors can expect in the days ahead.
What’s Happening with GCT Stock
GCT stock began surging as soon as markets opened today. By 11:30 a.m. Eastern, it had spiked more than 62% and Wall Street was taking notice. While the stock would start falling after that, it has since rallied and remains in the green for the afternoon. As of this writing, it is up more than 40% for the day.
This doesn’t necessarily mean that GCT stock is the next Reddit favorite. But it has still made an impressive debut that shouldn’t go unrecognized. It operates in the global business-to-business e-commerce space, an industry that is predicted to reach 18.7 trillion by 2027.
And as Astute Analytica reports, the Asia-Pacific region holds the largest market share. Relevantly, Chinese e-commerce giant JD.com (NASDAQ:JD) holds a 12% stake in GigaCloud. But Bloomberg reports that according to CFO David Lau, the company isn’t generating revenue from China.
Lau also notes that “A US listing would help us achieve not just valuation but also the profile we need to grow into the next phrase.”
What Comes Next
All told, it’s impossible to say for sure where GCT stock will go from here. However, its IPO should be counted as an overall success. While it didn’t see gains north of 1,000% like MEGL, it also didn’t plunge 20% like Innovative Eyewear (NASDAQ:LUCY).
Additionally, GCT stock has one advantage over its meme stock peers. After HKD skyrocketed onto Wall Street’s radars, InvestorPlace contributor David Moadel warned investors to proceed with caution. “It’s hard to pinpoint exactly what AMTD Digital does and what it’s been up to lately.”
GigaCloud, on the other hand, has a clearly defined mission and objective. That should help investors bet on it even as meme stock mania inevitably cools down.
On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.