Recently, multiple institutions such as Goldman Sachs, UBS, Barclays, and Citigroup have released research reports, believing that Alibaba's future development strategy is clear, its core business fundamentals are stable, and it can better grasp the growth opportunities brought by AI. In addition, the continuous increase in shareholder returns and the first dividend payout have boosted confidence, reaffirming Alibaba's "buy" or "increase" rating.
UBS pointed out in its research report that Alibaba has a clear strategic priority and a more comprehensive shareholder return strategy. After extensive communication with investors, negative emotions and concerns have generally decreased, and investors are looking forward to the implementation of new strategies in the next one or two quarters. Meanwhile, most investors believe that Alibaba's stock price is very attractive.
Multiple institutions still hold a positive attitude towards Alibaba's business fundamentals. UBS emphasizes that the user first and pricing strategy of Taobao and Tmall has shown initial results and is forming a positive growth cycle among users, merchants, and platforms. Especially Taobao and Tmall's investment in users and pricing power has formed a "positive cycle", laying a key foundation for sustained growth in the future.
Goldman Sachs also expressed optimism in its research report about the continued growth of advertising revenue on Taobao and Tmall, and emphasized that Taobao and Tmall CMR will maintain a median single digit growth, with Alibaba and other stocks continuing to be the preferred buyers in the e-commerce field.
Alibaba announced in its Q2 2024 financial report that it will no longer push for a complete spin off of the Cloud Intelligence Group and will focus on establishing a sustainable growth model for the Cloud Intelligence Group.
For this arrangement, Barclays pointed out in its research report that not splitting the cloud is the right decision in the long run. "The right decision is often the hardest to make," Barclays said. "In the long run, we believe that not splitting up may be the right decision." Nomura also stated that Alibaba Cloud, as a part of the Alibaba Group, will be retained and Alibaba's shareholders will be able to accept benefits for Alibaba Cloud's future growth.
More institutions believe that AI is expected to continue contributing revenue growth to Alibaba. Goldman Sachs emphasized in its latest research report that under the "AI driven" group strategy, it believes that Alibaba will better seize the growth opportunities brought by artificial intelligence.
Citigroup pays attention to the founder's reduction in holdings and bluntly states that "the market may have overreacted.". UBS also pointed out that the announcement of the news and performance on the same day was a coincidence, and this coincidence caused misunderstandings in the market.
According to document 144, this is the stock sale plan submitted on August 16th. According to 10b5-1 regulations, the company's directors and senior management must submit the sale plan at least three months in advance, and the sale date should not be earlier than two working days after the quarterly performance announcement. And November 16th happened to be the originally set disclosure time.
It is reported that this reduction in holdings is for the purpose of funding investment in agricultural technology and public welfare projects both domestically and internationally. Due to the set selling price of the stock being much higher than the current stock price, not a single share was actually sold.
Alibaba also stated that it will continue to improve its investment return rate, utilize cash flow to invest in future growth, and realize the value of non core assets. As of the end of this quarter, Alibaba's net cash was $63 billion, with free cash flow reaching $27 billion in the past 12 months, making it in the best position to invest in future innovation and growth.
For a period of time, Alibaba has continued to increase shareholder returns and announced its first annual dividend payout, with a scale of approximately $2.5 billion. Based on long-term confidence in future development, Alibaba has been conducting high-intensity and continuous repurchases for 5 consecutive years. Currently, there is still a repurchase quota of $14.6 billion under the share repurchase plan.
According to Barclays statistics, Alibaba's repurchase pace is still accelerating, with $3 billion repurchased in just the past four months. We believe that Alibaba's active stock repurchase and dividend actions are highly attractive to long-term holders.
According to real-time statistics from MarketBeat, among the 16 analysts who have been tracking Alibaba for a long time, 1 suggests StrongBuy, 13 suggests Buy, 2 suggests Hold, and 0 suggests Sell.
Attachment: Latest ratings and target prices of institutions (partial)