Morningstar | Alibaba GMV/Revenue Trends Reflect Uneven China Macro Picture, but We Still See Long-Term Potential
Over the past few years, Alibaba has transitioned from a traditional e-commerce company to a Big Data-centric conglomerate, with transaction data from its marketplaces, financial services, and logistics businesses allowing it to move into cloud computing, media/entertainment, and online-to-offline services. We've long thought that a strong network effect can allow e-commerce players to extend into other growth avenues, and nowhere is that more evident than Alibaba.Alibaba’s Internet services affect the vast majority of Chinese Internet users in some way, including a 70% penetration rate for the Taobao/Tmall e-commerce marketplaces. This provides Alibaba with an unparalleled source data that it can use to help merchants and other consumer brands develop personalized mobile marketing and content strategies to expand their target audiences, increase click-through rates and physical store transactions, and bolster return on investment. Alibaba's marketplace monetization rates have generally been on an upward trend despite recent macro uncertainty, indicating that sellers are becoming increasingly dependent on Alibaba's marketplaces and payment solutions. Retail revenue per active user continues to outpace other China rivals, owing in part to an emphasis on higher-quality merchants.While we view Taobao/Tmall marketplaces, Cainiao, and Alipay/Ant Financial as Alibaba's core cash flow drivers, we also believe AliCloud, globalization, digital entertainment, and Ele.me (food delivery) offer long-term potential. While AliCloud will remain in investment mode near-term, we believe accelerating revenue per user trends suggest a migration to value-added content delivery and database services that can drive segment margins higher over time. On globalization, third-party merchants are successfully reaching Lazada's users across Southeast Asia, something that should continue as the company rolls out incremental personalized mobile marketing and content opportunities. While early, we share management’s views about Ele.me and digital entertainment being important user acquisition and engagement tools.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.
Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
We have operations in 27 countries.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.