BABA - Embedded Expectations Analysis - 2019 02 20
Alibaba Group Holding Limited (BABA:USA) currently trades above corporate averages relative to UAFRS-based (Uniform) Earnings, with a 25.2x Uniform P/E. At these levels, the market has bearish expectations for the firm, and management has concerns about Chinese economic growth, Alipay synergies, and their ability to increase their customer baseSpecifically, management may have concerns about investor sentiment, and about Chinese economic growth and government policy. Furthermore, they may be exaggerating Alipay synergies, and may be concerned about their ability to drive user engagement. Additionally, they may lack confidence in their ability to grow their customer base, and provide relevant content to all users. Finally, they may be concerned about rising costs in their direct import business, and may lack confidence in their ability to capture growth opportunities from off-line payments
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