Sumary of Is Alibaba (BABA) A Smart Long-Term Buy?:
- You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.Artisan International Value Fund, in its Q3 2021 investor letter, mentioned Alibaba Group Holding Limited (NYSE: BABA) and discussed its stance on the firm.
- The stock closed at $136.62 per share on November 22, 2021.Here is what Artisan International Value Fund has to say about BABA in its Q3 2021 investor letter:”We also find Alibaba’s valuation compelling despite the prospect of increased regulation.
- Alibaba is China’s largest e-commerce business and is one of the highest return businesses in the world.
- The company’s core ecommerce operation dominates China’s retail industry.
- The company has large investments in cloud, financial services and other businesses worth an estimated $100 billion, leaving the core operations valued at $340 billion.
- Core operations over the last 12 months generated about $27 billion of after-tax profits, resulting in a trailing P/E of 12.5X.
- Alibaba certainly faces increased competition and a marginal increase in regulation.
- However, a company with Alibaba’s operating and financial strength should trade at a premium, rather than a significantly discounted valuation.