Alibaba (NYSE:BABA) is a powerful Chinese “Dragon” or “Tiger”, already the biggest e-commerce company in the world, surpassing even eBay and Amazon, thanks to their 1,5 bln customers in China. Now it’s stock prices are rising, and there is nothing in sight that could stop this Chinese juggernaut. But beginnings on New York Stock Exchange weren’t so great.
In 2014 Alibaba was already owner of largest Chinese ecommerce portal Taobao, wholesaler portal connecting suppliers from Asia with wholesalers from Europe and US – named Alibaba and Aliexpress, popular e-commerce retail portal with thousands of stores. Alibaba debuted on NYSE with $94 per share, but in the next year it fell more than 30%, mostly on alleged federal investigation in bad accountancy practices. As it turned out, there wasn’t any investigation and instead, company beat analysts’ expectations, gaining revenue of $5.14 billion. Currently about 70% of its profits come from Asian operations, however it is constantly growing in retail worldwide,which is always very popular with investors and will very likely boost stock price even more. Now Aliexpress stock is worth more $100, and it is rising fast.
Additionaly, Alibaba is constantly buying various companies to extended their influence even further. Recently it bought Singapore’s RedMart, a grocery delivery company and now it pushes its own payment processor, called Alipay, which is similar to PayPal. Alipay is already the most popular payment processor in China and now it can be integrated into western online stores.
So will Alibaba go up?
Analyst expect further growth of Alibaba and additional acquisitions. Company now “matured” on NYSE and investors don’t treat it as a exotic stock, used mainly for speculations. Alibaba stock is also eagarly bought by investment funds, which see it as a stable investment with enormous potential and access to the most populous market in the world – Chinese consumers. Moreover Alibaba is backed by government, which means it has favorable growth conditions in China, and it can only expand its operations.