Should I Buy Alibaba (BABA)? Finance YouTuber Analysis

The YouTuber views Alibaba as a green bet for long-term investors, especially considering its AI initiatives. He highlights its recent 11% jump and its status as a potentially undervalued AI stock.

“If you look at Alibaba from a long-term perspective and the AI bet, it's a green thing to bet on.”

The analyst suggests Alibaba is a compelling long-term buy, especially if it drops to the $60-$66 range, due to its significant investments in AI and cloud computing, which are expected to drive future growth. Despite short-term pressures from e-commerce competition and heavy investments, the company's intrinsic value is estimated at $120, offering substantial upside. He notes its strong position in the Chinese cloud market and its potential as a leading AI player.

“If we go to the worst case scenario, the margin of safety value investing, slow growth, low PE ratio, then Alibaba still needs to go down to let's say 66 60s.”

The YouTuber recommends Alibaba as a 'surprise winner' in the open-source AI boom, citing its Quinn AI model's popularity and ability to lower AI costs by allowing companies to run models on their own servers. He notes Quinn's strong performance against competitors and its role in driving business to Alibaba's cloud division.

“That's when I recommended shares of Alibaba to her Baba on the 21st of last month at just $94 each as the surprise winner in this coming open-source boom. The stock is up 20% in the last 3 weeks and still has much further to run.”

The YouTuber is buying Alibaba due to its open-source AI model, Quinn, which is gaining significant traction and downloads, offering a cost-effective alternative to closed-source models. This growth is expected to benefit Alibaba's cloud division and its own e-commerce operations. The stock is currently trading at a significant discount to its historical valuation, with strong double-digit earnings growth projected for the coming years, suggesting a potential upside of 32% to 64%.

“Shares of Alibaba rallied to as high as $192 each last year as investors clued into the company's strength in AI. But then geopolitical fears, fears over government oversight and just an exodus to US hardware stocks has brought it down 44% from that peak into strong value territory.”

The analyst suggests Alibaba is a buy due to China's potential leap in AI development, supported by increased access to faster chips and abundant power generation. He highlights Alibaba's dominance in e-commerce and cloud in China, and its competitive 'Quinn AI' model, noting its current cheap valuation at 2.4 times price-to-sales.

“But at a 2.4 times on a pricetoales basis, this stock is cheap for that potential. of valuation back up to just four times sales plus that annualized 15% revenue pace. That would produce a 20% annual return over the next decade for for more than six times your money.”

The YouTuber likes Alibaba for exposure to the China AI race, indicating a belief in its growth potential within the AI theme.

“here. I also like Alibaba, ticker BABA, for exposure to the China AI race, and Amazon, ticker AMZN, on its multiple levers for growth across e-commerce, cloud, and advertising.”

The analyst recommends buying Alibaba due to its significant valuation discount compared to US counterparts like Amazon, trading at a 30% discount on a price-to-sales basis. He believes its revenue growth will accelerate beyond current analyst estimates as it develops its cloud services and leverages the lifted US ban on Nvidia H200 chips to China.

“shares of Alibaba are trading for a 30% discount versus shares of Amazon on that on that price to sales valuation.”

The YouTuber recommends Alibaba as a short-term trade, citing strong demand from Chinese households for stocks. He notes that Chinese investors are moving record savings into equities from real estate, and recognizable consumer brands like Alibaba are likely to be top beneficiaries, especially towards year-end.

“Some of my favorites here would be Tencent, would be Alibaba and PDD holdings, that pin duo. My reasoning here is that these consumer names, okay, these are going to be top of- mind for households, for investors that uh that those that household spending, putting their savings now in equities into stocks, that's going to go into the most recognizable brands.”

Hogue suggests buying Alibaba due to its current deep value territory, trading at a 35% discount to its late last year valuation. He anticipates potential boosts from Chinese stimulus measures and a more nuanced US tariff strategy, alongside long-term growth levers from its AI model and aggressively priced cloud services.

“This was one of my biggest winners last year up $120,000 on the call options and the shares are back into that deep value territory.”

The YouTuber likes Alibaba shares based on valuation, having made significant profits from the stock and a bull option spread. He acknowledges its volatility due to company news, Chinese stimulus measures, and potential US policy changes.

“shares of Alibaba ticker Baba have been extremely volatile not just on company news but around stimulus measures in China and the potential policy changes here in the US I've made almost $73,000 on the stock and a bull option spread and continue to like the shares on valuation”

The YouTuber is holding Alibaba, noting it has come down from its previous run. While acknowledging it's no longer cheap or expensive, they see it as a good long-term bet on its AI model, but also recognize increased risks as a Chinese company. They are not adding to their position.

“This one is no longer cheap or expensive here but can still be a good long-term bet on its AI model but there are also more risks now as a Chinese company I'm not adding any more to my position.”

The YouTuber is holding his existing position in Alibaba, citing its e-commerce leadership, progress in AI, and previously low valuation. While it's no longer in deep value territory, he believes it's still a long-term hold, though he is not adding to his position due to concerns about China's economic recovery.

“I'm not adding to my position here I think you still can for that long-term holding but would consider selling call options against it at $130 strike price so offsetting that price by almost $12 and still having that upside to 130 over the next year”

The analyst is bullish on Alibaba for the short term, citing its upcoming primary listing on the Hong Kong exchange, which could attract up to $20 billion in inflows from mainland Chinese investors. This, combined with its cheap valuation and 8% revenue growth, makes it attractive, though a 'sell the news' event is possible after the listing.

“The company is likely to get its primary listing on the Hong Kong exchange next month which will open it up for investment from Mainland Chinese investors in what could be as much as $20 billion in inflows into the shares besides that cheap valuation and 8% Revenue growth this year I think this is why we see a lot of hedge funds like Michael bur and David terer buying up the stock in anticipation of that stock running higher heading into that dual listing.”

The YouTuber is bullish on Alibaba ahead of its earnings report, expecting management to raise its revenue outlook and confirm recent positive news. He cites the company's strong AI model integration, growth in global e-commerce, and potential new software service charges for merchants, noting the stock is still cheap at 1.5 times sales.

“Now I expect management to raise its Revenue outlook on Thursday earnings and confirm some of that recent news.”

The YouTuber believes Alibaba has more upside as value is unlocked from segment spin-offs and AI development, despite recent price bumps. The stock is trading at a deep discount on historical price multiples, with a projected PE ratio of around nine times based on estimated earnings of $9 per share and $130 billion in sales this year. The company's buyback program is taking nearly 2.5% of shares outstanding every quarter, or about 10% annually.

“Alibaba ticker Baba which bought back almost $5 billion of its shares in just the last 3 months alone on a recent bump in price Alibaba has become one of the largest stocks in my portfolio but should have more upside as value gets unlocked from segment spin-offs and AI development.”

The YouTuber recommends Alibaba as a deep value play, despite his usual caution with Chinese stocks. He notes its significant discount to historical and peer valuations, its dominant position in Chinese e-commerce, cloud, and payments, and the potential for value unlocking through asset spin-offs. Michael Burry's increased stake is also cited as a positive.

“Alibaba group Holdings tooker Baba isn't down as much as the other on the list only down 15% over the last year but this is still one with a deep discount the largest e-commerce company in China trades for about 1.4 times at sales a discount of 36% on the 2.2 times valuation at the end of last year”

The YouTuber suggests Alibaba as a potential growth contender in AI, highlighting its Qwen 72B model's strong performance. Despite past challenges in China, the stock is considered undervalued at 8.3 times P/E, an 83% discount to Amazon, making it attractive for a rebound with any positive news, such as further AI model rollout.

“a slowing growth in China and a 2022 Crackdown on tech companies have hobbled shares of Alibaba but the stock is now deep into value territory.”

The YouTuber recommends buying Alibaba (BABA) as an undervalued short-term investment, trading at a significant discount to its historical PE and Amazon. He believes the upcoming earnings report on May 16th could be a catalyst, especially with aggressive cloud pricing and AI model advancements potentially boosting revenue.

“Alibaba group took her Baba at $70 a share Alibaba trades for just eight times this year's expected earnings and for a price to revenue of just 1.4 times that is a 27% discount to its own PE ratio just last year and an 82% discount to the valuation investors are paying right now for shares of Amazon at 43 times this year's expected earnings.”

The analyst suggests buying Alibaba as it appears to be in support territory around $71 a share after a recent drop. The stock could rebound to $75 or higher before earnings. While aggressive cloud services pricing might impact profits, it is expected to boost top-line revenue growth.

“this appears to be support territory around $71 each and the stock could find its way back up to 75 and higher leading up to the earnings in a month”

The YouTuber believes Alibaba is one of the best buys in the market, citing its low forward P/E ratio of just eight times. It is currently the largest position in his portfolio, suggesting strong conviction in its value.

“At a Ford PE ratio of just eight times I think Alibaba ticker Baba is one of the Best Buys in the market is the largest position in my portfolio”

The YouTuber is buying Alibaba, considering it their best investment for the next few years due to its extreme undervaluation. Despite past struggles from government crackdowns and economic slowdowns, the company is growing revenue at over 8% and trades at a ridiculously cheap eight times price-to-earnings. They highlight the significant hidden value and note that value investors like Michael Burry have also increased their stake.

“There is a tremendous amount of value hidden in these shares at around eight times on a price to earnings basis it is ridiculously cheap for a company growing Revenue at 8% plus a year.”

The analyst holds a significant position in Alibaba, betting on a turnaround in the extremely negative sentiment surrounding Chinese stocks and the economy. He highlights the stock's low valuation at 8.3 times price-to-earnings as 'ridiculously cheap' for the company.

“I also have a big position in Alibaba myself with over 130 call options it's about 13,000 shares at a $70 strike price the stock is trading for just 8.3 times on a price to earnings basis which is ridiculously cheap for this company”

The analyst is confident in Alibaba due to its strong free cash flow generation, significant share buybacks, and expected 10% revenue growth despite a slowdown. He believes the stock is undervalued at 7.8 times earnings compared to Amazon's 48x PE. Potential catalysts include the sale of non-core businesses, spin-offs of logistics, cloud, and Ant Financial, and a potential upside surprise in cloud revenue due to AI testing, similar to recent reports from Amazon and Microsoft.

“Baba is probably the one I feel the most confident about and we could get some very big news when earnings are reported this Wednesday.”

The analyst believes Alibaba and other Chinese stocks have reached 'peak fear,' making them strong investment opportunities for the next few years. This suggests a contrarian view that the worst is over for these assets.

“I love the pullback in Sofi Technologies ticker Sofi as a way to buy more shares and I think we've reached Peak fear in shares of Alibaba ticker baaba and a lot of those other Chinese stocks they're going to make it a strong investment over the next few years”

The YouTuber continues to hold Alibaba, noting that Chinese stocks are flashing strong buy signals due to a historically wide gap between their earnings yield and the 10-year treasury. He also points to increasing government stimulus and the potential for investors to rush back into these shares with any sign of an economic rebound.

“I continue to hold Alibaba ticker Baba as well as the CSI China internet ETF”

The YouTuber is watching Alibaba ahead of its earnings, noting its low P/E ratio of 9.1x despite 10% annual sales growth. He expects a boost from its breakup into six different companies and anticipates Chinese fiscal and monetary stimulus measures will ignite further growth.

“Alibaba group ticker Baba also going to be reporting its earnings Thursday with the market expecting just a 10% rise in its earnings to $212 per share for the quarter F year earnings are expected around $98 a share meaning the Chinese e-commerce leader is trading for just 9.1 times on a price to earnings basis this is a stock growing it sales by 10% a year is uh breaking up into six different stocks so it's going to have some strong investor sentiment Boost from that as investors look forward to getting those six different stocks out of one.”

The YouTuber recommends Alibaba due to its significant valuation discount compared to Amazon, despite having a similar business model and higher expected sales growth. He also sees strong near-term catalysts from its breakup into six different companies, with a conservative price target of $120 and potential to reach $150.

“I have a conservative $120 price target for Baba over the next year but believe it could go as high as $150 a share while it doesn't have the iPhone brand behind it.”

The YouTuber believes Alibaba will reach $120+ per share over the next year, citing an improved outlook for the Chinese e-commerce leader due to economic recovery and upcoming catalysts. These catalysts include the restructuring of its Ant Financial subsidiary for a Hong Kong IPO and the planned split into six companies, with an IPO expected for its logistics unit.

“I still believe we'll see 120 plus per share over the next year in this stock”

The YouTuber identifies Alibaba as a value play with a low P/E of 11x and a PEG ratio of 1.1x, close to his target of 1.0x for growth stocks. He expects general Chinese consumption to increase, and highlights the company's AI product development and upcoming segment spin-offs as potential catalysts for investor sentiment.

“now that already puts them in value territory with a p e ratio of just 11 times earnings but with a 10 plus expected earnings growth over the next two years that brings the PG ratio down to just 1.1 times.”

Joseph Hogue considers Alibaba Group Holdings a strong buy, despite potential short-term volatility, due to its plan to split into six independent companies. He believes this restructuring will unlock significant value, with shares potentially reaching at least $130 each over the next year, as each segment may pursue its own IPO.

“Alibaba group Holdings ticker Baba may give back some of last week's 19 jump over the next week or two or you see it did fall to one percent last Friday but it is still a strong Buy on the news that it's going to plan to split into six companies I highlighted the valuation on this in a video last week I'll link to that in the description below it and I really like the shares up to at least 130 each over the next year.”

The YouTuber argues that Alibaba is significantly undervalued due to a 'conglomerate discount' and that its planned six-way split will unlock substantial value. By performing a sum-of-parts valuation, comparing each new segment to pure-play competitors, he estimates the combined value of the independent companies to be 21% higher than Alibaba's current market capitalization, leading to a target price of $112 per share based on current valuations. He also expects further growth from China's economic reopening.

“I already own the stock and why my price Target just went up 20 on this news so excited about this... I'm going to show you why it should be worth even more than that.”

The YouTuber identifies Alibaba as his only Chinese stock holding and one he would consider touching, despite geopolitical tensions. He highlights its attractive valuation at 2.1 times sales, its significant rebound from October lows, and the fact that even 'perma-bear' Michael Burry is buying shares, suggesting a strong value proposition.

“It's still up 57% from the October low and and trading for a pretty attractive 2.1 time sale. So this stock is relatively cheap uh you know against its history.”

The analyst owns Alibaba and believes the China reopening story could drive the stock higher. Despite an 87% run, it remains attractively priced and below long-term valuations. The cooling regulatory environment and potential IPO of Ant Financial could significantly boost shares.

“I own the stock I I've got the stock at least up into up to 150 or 175 over the next year”

The analyst views Alibaba as a 'lottery ticket' investment due to its extremely low valuation (10.5x P/E, 1.75x sales) compared to historical averages and peers like Amazon, suggesting significant upside potential if delisting risks are mitigated. Despite regulatory headwinds and increased competition impacting profitability, the company maintains strong market dominance in China, high customer retention, and a robust balance sheet with substantial cash reserves. The primary risk is potential delisting from US exchanges, which could lead to a significant price drop, but the analyst believes the potential reward outweighs this risk given the current valuation.

“for me though as an investor the valuation has just gotten so ridiculously cheap that this risk is worth it with a three-year price prediction upwards of four hundred dollars for alibaba stock I can take a little more risk for that kind of return and actually did pick up a hundred shares last week for just under nine thousand dollars in my own portfolio”

The YouTuber suggests Alibaba as a high-risk, high-reward opportunity, noting its 62% drop from its peak due to Chinese government intervention and delisting risks. Despite the risks, he considers it a great company with an e-commerce advantage, currently trading at a steep discount, offering potential for significant returns on a rebound.

“shares of alibaba ticker b-a-b-a are down 62 percent from its peak last year it's a great company with an advantage in e-commerce and trading at a steep discount but the risk is there to more losses so here china is really a case study and those risks to emerging market stocks the risk of government interference or those geopolitical issues between two countries hit the stocks for investors willing to take the risk though you can get some great returns on a rebound”

The YouTuber argues that Alibaba is currently too cheap to ignore, trading at a significant discount compared to Amazon despite higher revenue growth. He believes the near-term fear regarding delisting is overdone and sees a trading opportunity for a short-term rebound, with a potential long-term upside even if it moves to OTC markets.

“7.7 drop in shares of Alibaba today I think I will pick up shares here it is just too cheap to ignore”

The YouTuber considers Alibaba a buy, noting its extensive user base and significant share of China's retail sales, with strong revenue growth. The stock is valued cheaply at 3.3 times price-to-sales and 15.8 times earnings, especially when compared to Amazon's similar business model. While acknowledging risks from Chinese government crackdowns, the valuation presents a compelling opportunity.

“now that puts the stock at just 3.3 times on a price to sales basis and 15.8 times earnings and compare that to amazon which is an almost identical business model that trades for 3.9 times sales and 58 times earnings and you can see how cheap the shares really are here”

The YouTuber is buying Alibaba, viewing it as the 'Amazon of China' with significant potential despite recent geopolitical and AI-related controversies. He emphasizes its large free cash flow, consistent profit margins, and strong revenue growth projections, believing the market is overlooking its intrinsic value.

“It roared back on AI excitement, running from the 60s to nearly $190. But it has since pulled back close to 50% from those October highs.”

The YouTuber notes Michael Burry's continued accumulation of Alibaba shares, despite geopolitical and regulatory concerns. The thesis is that it's a good business ignored by the market and trading cheaply, aligning with Burry's strategy of buying beaten-down assets.

“Same thesis, good business, ignored by the market, trading cheap.”

The YouTuber is accumulating Alibaba shares, viewing it as a long-term play on China's economic growth. He highlights the company's new AI chip, which reduces reliance on external providers, and the triple-digit growth in its AI-related cloud revenue. Despite a recent pullback, he believes the underlying business is strengthening and the stock is undervalued based on his discounted cash flow analysis, projecting a potential 17.5% annual return.

“My thesis on Alibaba is long-term China play. Do I think China will be a much bigger economy 10, 20, 30 years from now? And if they are, will Alibaba be a big benefactor of that? I do think so.”

The analyst is currently long Alibaba, viewing it as one of the most attractive titles after a significant correction. They note its current forward P/E of 10 and are considering adding to their position if the price drops further, targeting the 786 Fibonacci level around $88.43.

“Wir haben nun bereits eine Position gesetzt bei Alibaba. Das heißt, wir sind long. Ja, wir sind in Minus mit dieser Position, aber das ist vollkommen normal. Das ist eine langfristige Position.”

The analyst is waiting for a specific technical setup to initiate a new long position in Alibaba. They anticipate either a short-term rally followed by a drop into their final target zone, or the market is already in the process of reaching this zone. A buy order will be placed when the price hits the upper boundary of this calculated target zone, based on their Elliott Wave methodology.

“sobald wir die Oberkante der Zielzone am 618er Fibonacci treffen, würden wir automatisch eine weitere Kauforderen Kauf direkt tätigen.”

The YouTuber currently owns Alibaba and notes it's at a 'decent level.' He acknowledges geopolitical risks but is watching for a significant opportunity to potentially add to his position, though he's not actively buying more at the current price.

“Alibaba. That one I do own, and it's at a decent level now, but I'm not sure I need to add more to my position at this point. I understand there's a bit more geopolitical risk with that type of company, but it is one that I want to watch.”

The YouTuber believes Alibaba is a great company with strong fundamentals, executing well despite a tough operating environment and Chinese government influence. However, he advises limiting position size due to the inherent discount Wall Street places on Chinese stocks (ADRs) and the associated risks not present in comparable US companies like Amazon.

“I think Alibaba is a great company, but I would never own as much Alibaba as I do Amazon, for example. Not even close. because I cannot I I want to own the company. I want exposure to China because I believe obviously China is going to grow despite all the media narratives out there and everything else.”

David Tepper continues to hold a significant position in Alibaba, citing the overall undervaluation of Chinese stocks and the potential for a massive influx of domestic savings into the market. He believes the Chinese central bank's easing policies will drive inflation and encourage investment in equities.

“Las grandes acciones tecnológicas chinas pues son interesantes por este motivo.”

The YouTuber incurred his largest loss on Alibaba, attributing it to underestimating the Chinese government's willingness to interfere with its own companies and overestimating Alibaba's competitive strength. He realized the government prioritized power over company profits and that Alibaba's fundamentals decelerated significantly, leading him to sell.

“I underestimated the extent the Chinese government would interfere with their own companies and destroy capital of their largest companies. ... The second thing was I simply overestimated how strong of a company Alibaba was.”

The YouTuber reports that Michael Burry has sold his long positions and bought put options against Alibaba, indicating a bearish stance. This is attributed to the escalating trade war between the US and China, which could negatively impact consumer demand, squeeze margins, and create regulatory issues for Chinese tech companies.

“He opened up put option positions against Alibaba, JD, Pingjo and BU, as well as other companies such as Nvidia and Trip.com.”

The YouTuber reports that Michael Burry significantly reduced his Alibaba position by 25%, likely taking profits after a 40% spike in Q4 2024. This move is attributed to recent government support and regulatory easing in China, which has boosted investor confidence in Chinese tech stocks.

“while he added pin Joo Jo to his portfolio his previous two largest bets that being JD and Alibaba saw significant reductions 25% Alibaba and 40% in JD so why did he reduce well my best guess is that bar is simply taking profits because For the first time in a long while Chinese tech stocks have actually been performing well with Alibaba spiking 40% in Q4 2024”

Howard Marks and Michael Burry have increased their holdings in Alibaba, seeing opportunity in its deeply discounted valuation after significant declines. They believe the company, a backbone of China's tech economy, is a classic value play, especially with the Chinese government pivoting towards more market-friendly policies and economic stimulus.

“Michael best known of course for predicting the 2008 financial crisis increased his Holdings in Alibaba... these stocks are now trading at deeply discounted multiples compared to their historical valuations.”

The YouTuber, citing Matthew Peterson and other 'super investors', argues Alibaba is one of the cheapest large companies globally. Despite political risks, its strong fundamentals, including significant operating income, free cash flow, and share buybacks, make its valuation highly attractive. The Enterprise Value to Free Cash Flow multiple of 8.93 suggests the business could pay back its owners in about 9 years.

“Alibaba in my perspective is one of the cheapest large companies that exists in the world and that's really what it comes down to the political risks involved have created a rare situation where these exceptionally strong businesses are now at very depressed valuations.”

The YouTuber notes Michael Burry's continued accumulation of Chinese tech stocks, specifically adding 24% to his Alibaba position. Despite current macroeconomic headwinds in China affecting consumer spending and leading to significant stock price drops (Alibaba down 73% from its peak), Burry likely sees these companies as undervalued. Alibaba's current price-to-free cash flow of around eight suggests it's cheap, positioning it for a long-term recovery.

“I think that's what Michael bar sees he puts the value investing cap on his sees these businesses that are very strong in the Chinese economy they're cheap due to the macro landscape so he's going to hold on to them and potentially benefit from a longer term recovery”

The YouTuber recommends buying Alibaba on dips, suggesting it's a stock to pivot into when other tech stocks like AMD and Tesla might be out of favor. He implies it's a good opportunity to make money.

“Baba is one of those ones so if you ever catch this on a dip make sure you use it as opportunity to get in get you some money.”

The investor holds Alibaba as part of his single stock portfolio, believing it has good future return potential. He actively follows the company's quarterly reports and is passionate about the business.

“Perché io credo che nel futuro possano avere buoni rendimenti”

The YouTuber reiterates his long-standing bullish stance on Alibaba, citing its aggressive share buyback program (reducing shares outstanding by 2.1% in the last quarter) and a 1% dividend, returning significant capital to shareholders. He emphasizes Alibaba's market-leading positions in Chinese e-commerce and cloud computing, with its cloud segment poised for strong growth due to increasing AI demand. Factoring in its $60 billion net cash balance, he estimates the stock trades at a very cheap 6-7 times earnings, making it an attractive long-term investment.

“Alibaba is set up to continue growing strong and well over the longterm in China and I think that the business's price was absurdly cheap over the past couple of years and I do still believe that the stock is cheap today”

The YouTuber is holding Alibaba, believing it is significantly undervalued despite recent declines in profitability metrics. He highlights the company's strong cash position, aggressive share buybacks, and the rapid growth and increasing profitability of its Cloud business, especially in AI-related products. He also points to Alibaba's dominant market share in China's public cloud market, which is projected for substantial growth, and argues that the stock already prices in the 'China risk'.

“I do still believe that Alibaba is cheap in the stock market today and I am going to be holding the position in my portfolio.”

The YouTuber believes Alibaba is very cheap, trading at a price-to-free cash flow of 8.24 (12.13% yield). He highlights recent strategic moves like raising $4.5 billion at 0.5% interest to fund share buybacks at a 12% free cash flow yield, and aggressive share repurchases reducing the share count by 9% annually. With a new CEO focused on long-term profitability and a dominant position in the rapidly growing Chinese cloud market, he expects market-beating returns even with pessimistic free cash flow growth assumptions.

“at an eight price to free cash flow I don't think that any of this growth is currently being priced in to Alibaba stock at all”

The YouTuber notes that David Tepper significantly increased his position in Alibaba, seeing an opportunity in Chinese stocks that were trading at low valuations (around 10 times earnings) in Q1 2024 due to concerns about slowing growth and political changes. Tepper views this as a deep value play.

“Alibaba is a position that Tepper has held for quite a while at least a small position but obviously increased that pretty significantly.”

The YouTuber notes that Michael Burry has increased his stake in Alibaba, similar to JD.com, due to its value proposition. He points to a forward P/E multiple of 10.7 and an Enterprise Value to Sales multiple of 1.3, indicating it's trading at a significant discount from its 2020 highs.

“on a forward multiple perspective we're getting similar valuation to jd.com price earnings multiple on a forward basis 10.7 and an Enterprise Value to sales multiple of 1.3”

The YouTuber notes that David Tepper has established a sizable position in Alibaba, despite the inherent risks of investing in Chinese companies. Tepper appears to see significant value and opportunity in Alibaba, suggesting he believes the potential rewards outweigh the geopolitical and economic uncertainties.

“Alibaba which I think a lot of investors think is a phenomenal value there's absolutely risks investing in Chinese companies given the ownership structure there given the things that we don't know about the future of the economy there but teer is seeing enough opportunity to at least put a pretty sizable position in place.”

The YouTuber notes that David Tepper has significantly increased his stake in Alibaba, making it one of his largest positions. Tepper is known for buying 'beaten up' stocks that are in value territory, suggesting he sees an opportunity in Alibaba as a contrarian play, similar to his past successful investments in Meta and early Nvidia.

“Also a big increase in the stake in Alibaba now the fifth largest position now the sixth largest position in temer's portfolio Alibaba is one of these stocks that I think has really gone into value territory.”

The analyst argues that Alibaba is a strong buy due to its historical rapid growth in revenue and EBITDA, strong free cash flow, and low debt. Despite potential headwinds from the CCP and delisting risks, a conservative forecast still yields a 25% internal rate of return over 10 years, making it an attractive risk-reward proposition in the current market.

“a 25 percent irr or five times my money in 10 years that's a strong very strong return we don't see too many irrs like this in this analysis”

The YouTuber owns Alibaba and is not selling despite the significant price drop and regulatory pressures. He notes that fundamentally, Alibaba is a 'Christmas gift' due to its low valuation compared to historical averages, and mentions that investors like Charlie Munger have also bought in. However, he acknowledges the ongoing regulatory challenges and their impact on profitability and future growth potential, suggesting that while the stock is undervalued, its previous high valuations might not be reached again.

“ich verkaufe momentan aber alibaba auch nicht wie er beispielsweise das heißt ich behalte jetzt einfach im depot”

Alibaba is presented as fundamentally undervalued, with strong growth in revenue and cash flows, despite recent setbacks in reported earnings due to regulatory fines and political pressure in China. The stock trades at a significantly lower P/E ratio compared to its historical average. The YouTuber suggests buying if an investor believes the political headwinds will eventually stabilize, allowing the company to resume its growth trajectory.

“mit der meinung kommt dann könnte man quasi an die bawag auf und sagt das war alles viel zu unsicher dann hätte man die partie finger da schon gut”

Despite Alibaba's impressive growth (42% revenue growth) and low valuation (P/E of 22), the YouTuber warns against investing due to severe regulatory risks. The cancellation of Ant Financial's IPO, a large antitrust fine, and the disappearance of Jack Ma illustrate the unpredictable and detrimental government interventions that undermine property rights and business stability, making it a highly speculative investment.

“einfach nur nachkaufen wegen der günstigen bewertung kann eine strategie sein soll da war mit viel vorsicht gemacht werden in der aktuellen phase”