Alibaba's share price is having the worst 3 years since it went public. And 2023 has not been a good year either. The share price has lost almost 18.8% year to date.
Alibaba's share price has been falling for several reasons, including:
1. Increased competition: Alibaba is facing increased competition from other Chinese e-commerce giants such as Pinduoduo and JD.com. These companies are offering lower prices and more aggressive promotions, which is putting pressure on Alibaba's margins.
2. Regulatory scrutiny: The Chinese government has been cracking down on tech companies in recent years, and Alibaba has been one of the companies that has been targeted. The government has imposed new regulations on the company's data practices and its market power.
3. Economic slowdown: The Chinese economy is slowing down, and this is hurting Alibaba's business. Consumers are spending less money, and businesses are cutting back on their advertising budgets.
4. U.S. export controls: The U.S. government has imposed export controls on some advanced computing chips, and this is hurting Alibaba's cloud computing business. The company is unable to access the chips that it needs to develop and deploy new cloud services.
5. Alipay stake sale: Alibaba's sub-subsidiary Alipay is selling its stake in India's Zomato. This is a sign that Alibaba is losing confidence in the Indian market.
However, fundamentally Alibaba still looks attractive and it is one of the most undervalued companies I am looking into. The company is trading close to its 2014 IPO price of $68, allowing me to buy the stock for the first time. The company is not out of the woods just yet.
I am waiting for $68 with a partial entry when the market opens.
Alibaba's share price has been falling for several reasons, including:
1. Increased competition: Alibaba is facing increased competition from other Chinese e-commerce giants such as Pinduoduo and JD.com. These companies are offering lower prices and more aggressive promotions, which is putting pressure on Alibaba's margins.
2. Regulatory scrutiny: The Chinese government has been cracking down on tech companies in recent years, and Alibaba has been one of the companies that has been targeted. The government has imposed new regulations on the company's data practices and its market power.
3. Economic slowdown: The Chinese economy is slowing down, and this is hurting Alibaba's business. Consumers are spending less money, and businesses are cutting back on their advertising budgets.
4. U.S. export controls: The U.S. government has imposed export controls on some advanced computing chips, and this is hurting Alibaba's cloud computing business. The company is unable to access the chips that it needs to develop and deploy new cloud services.
5. Alipay stake sale: Alibaba's sub-subsidiary Alipay is selling its stake in India's Zomato. This is a sign that Alibaba is losing confidence in the Indian market.
However, fundamentally Alibaba still looks attractive and it is one of the most undervalued companies I am looking into. The company is trading close to its 2014 IPO price of $68, allowing me to buy the stock for the first time. The company is not out of the woods just yet.
I am waiting for $68 with a partial entry when the market opens.