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- WSJ reported that BABA's Tmall Global is not gaining as much traction 10 months after launch, implying the platform is failing to live up to market expectations.
- On the contrary, I believe Tmall Global's current progress to be encouraging.
- Investors can expect higher traffic from 1) increasing merchant base and 2) introduction of an ad-based model.
- Long BABA.
- Alibaba has three non-GAAP metrics, but do they really tell the true story of the company?
- Non-GAAP metrics are generally used to provide insight into a company's operations vs. traditional GAAP metrics.
- The results are pretty interesting considering that Alibaba has received heat for being overly complicated and non-transparent.
- The “platform” business model usually generates higher margins than the “direct retailing” model.
- Alibaba’s platform business model has drawbacks such as lower control of product quality and weak logistic services.
- The demonstrated customer adherence to Taobao and Tmall marketplace plus the strong executive force in solving problems with its platforms will make Alibaba a more attractive investment opportunity than JD.
Alibaba & Double 12: There Goes Jack Ma Making Up Holidays Again
- Double 12 is another holiday designed to build off the enormous success of Alibaba's Singles Day.
- Alibaba's IPO money seemingly has helped them to promote this previously unknown event into another huge shopping "holiday".
- Promotions via the Alipay Wallet app drove many consumers to take advantage of 020 commerce special deals at stores where they otherwise probably would not have gone.
- The growth in Alipay's valuation, and eventual Chinese IPO, should be a significant driver for Alibaba stock in 2015. BABA's stake in the most recent valuation is $23 billion.
- How many Double Number shopping holidays can the enormous Chinese e-commerce market actually support?
- BABA released new data indicating that mobile accounts for 54% of transactions versus 22% a year ago.
- Increasing smartphone adoption driving m-commerce, which drives Alipay.
- Long-term growth lies in the integration of Aliyun ecosystem and penetration into North America.
Alibaba And Internet TV: If At First You Don't Succeed, Try, Try Again
- BABA is launching a new set of TVs in China to drive additional traffic to its e-commerce platforms.
- Integration of BABA's other assets in online video and content will be the key differentiators.
- BABA remains my top pick among US-listed e-commerce plays given the potential growth of the Aliyun ecosystem.
Alibaba Going Global Part II: Connecting East And West
- BABA will partner with US retailers to bring Black Friday to China.
- TMall is an important platform for foreign retailers to penetrate China without investing in warehouses and logistics.
- Expect additional retailers to leverage TMall; BABA is the main beneficiary of the trend.
Alibaba Exploded: Should Other Chinese Stocks Follow?
- Since its IPO, Alibaba has gained $113 billion in market cap.
- Alibaba isn't overvalued compared to other internet stocks, but is overvalued compared to other Chinese stocks that stand to benefit from growing eCommerce activity.
- Either Alibaba drops to a level more comparable to other Chinese stocks or these other stocks rise as the fear of fraud is replaced with the prospect of high growth.
- Reuters reported that Alibaba is interested in launching an international version of Taobao.
- Taobao's product mix could be compelling to international consumers; long-term threat to eBay and Amazon remain.
- Long BABA and GOOG, short EBAY. Neutral on AMZN.
- Alibaba controls a large chunk of China's B2C market, meaning the company's future growth in China could be tied to the industry itself.
- Alibaba must pursue international growth aside from B2C.
- A recent report states that BABA is planning to launch an international version to its Taobao Marketplace, a potential game changer.
Alibaba Debuts Its First-Ever Bond Offering To Investors
- Alibaba debuts its first-ever bond offering, expected to be around $8 billion, on Thursday.
- The company seeks fresh capital to expand to the West by creating a new digital "silk road" for intercontinental online trade.
- With the ebb and flow of short interest in Alibaba shares and its strengthened fundamentals, a contrarian view is timely.
- Alibaba is making waves with its overt romancing of Hollywood executives.
- Fresh off its $25 billion IPO, Alibaba is causing the rumor mill to go haywire over potential M&A.
- Instead of swooping in and rescuing Netflix, Alibaba should continue hustling Hollywood on its own.
- Hedge fund managers loaded up on BABA in Q3.
- As I previously wrote, supply/demand will drive prices for BABA in the early days.
- Valuations will eventually return to the forefront and BABA will probably look pretty expensive anywhere north of $100/share.
Tue, Dec. 23, 2:46 PM
- Looking to counter frequent complaints about the sale of counterfeit merchandise on its marketplaces, Alibaba (BABA -2.3%) says it has spent over RMB1B ($161M) since the start of 2013 battling fake goods and improving customer protection from them.
- The remarks come as Alibaba steps up its efforts to expand in the U.S. and other international markets where counterfeits risk becoming a political/regulatory problem if unaddressed. The company recently announced it's launching an international version of its massive Taobao marketplace (focused on smaller merchants), to complement its existing overseas-focused sites (Alibaba.com, AliExpress).
- A few years ago, the U.S. Trade Representative put Alibaba's marketplaces on its list of "notorious markets" for IP infringement. More recently, a Chinese ministry reported 10.6% of the goods it bought online (from Alibaba sites and elsewhere) during a Singles Day investigation were fake or very suspicious.
Mon, Dec. 22, 6:46 PM
- With China having recently lifted a 15-year ban on console sales, Alibaba (NYSE:BABA) is prepping a high-end console that could launch in early 2015, Asian gaming research firm Niko Partners reports hearing.
- Microsoft recently launched the Xbox One in China, and Sony plans to launch the PS4 in the country next month. Aside from the console giants, an Alibaba console would have to contend with China's entrenched PC gaming culture and the widespread availability of black-market consoles that can play pirated games.
- Alibaba has already shown a strong interest in both gaming and living room entertainment. Among other things, the company has launched a set-top (running on a proprietary OS), invested in multiple video content providers, taken a $120M stake in game developer Kabam, and created a mobile game-publishing arm.
Mon, Dec. 8, 11:50 AM
- Mobile accounted for 54% of Alipay's transaction volume over the first ten months of 2014, up from 22% during the whole of 2013. The Chinese online payments giant partly attributes the growth to the fact many users in rural areas smaller cities rely on phones/tablets as their primary e-commerce tool.
- For reference, Alibaba (NYSE:BABA) received 35.8% of its marketplaces GMV from mobile in calendar Q3, and 42.6% on Singles Day.
- Alibaba stands to receive a 33% stake in Alipay parent Ant Financial at IPO time, and is entitled to 37.5% of its op. profit in the interim. Pac Crest recently assigned Alipay/Ant a $70B valuation.
- Previous: Jack Ma promises Alipay will go public
Mon, Dec. 1, 2:09 PM
- Chinese chat app/social network owner MOMO is looking to sell 16M shares within a $12.50-$14.50 range. At the midpoint, that spells gross proceeds of $216M, and a valuation of $2.5B. (prospectus)
- In tandem with the offering, Alibaba (BABA -5.2%) and 58.com (WUBA -1.3%) will respectively be buying $50M and $10M worth of shares through a private placement.
- Alibaba, already a major investor in Momo, stands to have a 20.4% post-IPO stake; it's worth $511M at the price range's midpoint.
- Prior Momo IPO coverage
Mon, Dec. 1, 10:38 AM
- Chinese Internet and telecom names are among the biggest tech decliners as the Nasdaq registers a 0.9% drop. A soft November PMI print isn't helping.
- Giants Alibaba (BABA -4.3%) and Baidu (BIDU -2.8%) are among the casualties. As is Qunar (QUNR -5.8%), which reports after the bell.
- Other Internet decliners: BITA -12%. QIHU -4.4%. CTRP -4.3%. SFUN -7.2%. LEJU -7.5%. RENN -6.3%. SINA -3.8%. WB -3%. YY -3.9%. VIPS -3.8%. SOHU -3.5%. MOBI -4.3%. CMGE -8.6%.
- Telecom decliners: CHL -3.6%. CHU -3.9%. CHA -4%.
- ETFs: KWEB, CQQQ, QQQC
Thu, Nov. 27, 5:31 AM
- Renewing its push into the Internet TV market, Alibaba (NYSE:BABA) and partner Haier Electronics (OTCPK:HRELY) have launched new TVs in China that provide users with access to the e-commerce company’s Taobao and Tmall online marketplaces as well as movies and video games.
- Last year, Alibaba launched a smart TV with Chinese TV manufacturer Skyworth (OTCPK:SWDHY), but the product failed quickly because its online entertainment offerings were limited.
Fri, Nov. 21, 9:15 AM
- Alibaba (NYSE:BABA) is offering $300M of floating rate notes due 2017, $1B of 1.625% notes due 2017, $2.25B of 2.5% notes due 2019, $1.5B of 3.125% notes due 2021, $2.25B of 3.6% notes due 2024, and $700M of 4.5% notes due 2034.
- Issue prices per note range from 100% for the floating rate notes to 99.439% for the 2034 notes. The offering is expected to close on Nov. 28.
- Shares +2.7% premarket, aided by higher equity futures.
- Yesterday: Alibaba reportedly launches offering, sees huge demand
Thu, Nov. 20, 1:04 PM
- Reuters reports Alibaba (BABA +2.5%) has launched an $8B, 6-part, debt offering. The Chinese e-commerce giant previously said it plans to use the offering to refinance its credit facilities.
- Bloomberg reports Alibaba has received $57B in orders for the offering, and that underwriters "lowered the premium by as much as 0.25 percentage point on its longest-dated bond" due to the demand.
- Much like many U.S. tech large-caps, Alibaba is getting low interest rates. Bloomberg: "Alibaba is marketing three-year fixed-rate notes at about 70 basis points over similar-maturity Treasuries, five-year debentures at about 95 basis points and seven-year securities at about 115 basis points. Ten- and 20-year bonds are being offered at about 130 basis points and 150 basis points, respectively."
- After seeing profit-taking over the last few trading days, shares are once more rallying.
- Earlier: Alibaba launching international Taobao marketplace
Thu, Nov. 20, 4:55 AM
- Jack Ma has announced that Alibaba (NYSE:BABA) will set up an international version of its e-commerce marketplace Taobao, intensifying competition with rivals Amazon (NASDAQ:AMZN) and eBay (NASDAQ:EBAY).
- The new website will serve buyers worldwide in multiple languages, including English and Chinese.
- Alibaba currently has an international e-commerce platform specializing in wholesale goods called Aliexpress but does not have an international offering for consumers to sell to each other.
- Meanwhile, the company is selling its first-ever bond offering today, a giant trade expected to be around $8B in size.
Thu, Nov. 13, 1:44 PM
- Bloomberg's report suggests Alibaba (BABA -2.1%) is looking to refinance the lion's share of its outstanding borrowings ($10.4B at the end of September). Morgan Stanley, Citi, Deutsche, and JPMorgan will reportedly market Alibaba's bonds next week.
- Alibaba announced this morning it's planning a bond sale to refinance its credit facilities, but didn't provide details. S&P and Moody's have respectively given the bonds A+ and A1 ratings.
- After opening higher, shares have seen some profit-taking. Alibaba's market cap currently stands at $285B.
Thu, Nov. 13, 9:29 AM
- Alibaba (NYSE:BABA) plans to sell senior unsecured notes, primarily to "refinance its existing credit facilities." The company hasn't yet announced the offering's size or pricing.
- Thanks in part to its IPO, Alibaba had $17.9B in cash/short-term investments at the end of September. Bank borrowings totaled $8.7B, and secured borrowings $1.7B.
- BABA +1.1% premarket.
Wed, Nov. 12, 1:15 PM
- Much as they did a week ago, Yahoo (YHOO +2.8%) and Alibaba (BABA +3.7%) are rallying following upbeat Street commentary. BofA/Merrill and UBS have hiked their Yahoo targets in the wake of the BrightRoll deal, BMO and SunTrust have offered positive remarks about Alibaba's Singles Day performance, and HSBC has launched coverage on Alibaba at Overweight.
- BofA/Merrill's Justin Post argues BrightRoll "should enhance Yahoo’s video ad serving capabilities and put the company in a more competitive position with Facebook’s LiveRail, AOL’s Adap.tv and YouTube." His target has been hiked by $7 to $55.
- SunTrust's Robert Peck thinks Alibaba's Singles Day revenue may have risen 65% Y/Y. He also expects the company's mobile monetization rate (up strongly in FQ2, though still below PC levels) to rise again in FQ3, aided by "Tmall growth and strong ROIs for mobile ads on Taobao."
Wed, Nov. 12, 3:33 AM
- After reporting more than $9B in sales on China's Singles' Day yesterday, Alibaba's (NYSE:BABA) Vice Chairman says he is open to working with PayPal (NASDAQ:EBAY) to expand its payment options.
- "If you look at our footprint of being the largest online payment company in China, and PayPal’s position of having a very good international position...these are some complementary footprints," says Joseph Tsai.
- The company also sees Apple's (NASDAQ:AAPL) payment system as helping Chinese consumers when Alibaba's finance affiliate Alipay isn’t accepted.
Tue, Nov. 11, 11:25 AM
- Altogether, Alibaba's (NYSE:BABA) Singles Day GMV rose 58% Y/Y, thereby exceeding the 49% GMV growth the company saw in FQ2.
- Mobile accounted for 42.6% of Singles Day GMV, topping its 35.8% share of FQ2 GMV.
- Investors are selling on the news. Alibaba had risen 17% since posting its FQ2 report a week ago.
- Prior Alibaba coverage
Tue, Nov. 11, 9:03 AM
- As of 8:43 PM Hangzhou time, Alipay had handled over $8B (RMB48.9B) of Singles Day transactions on Alibaba's (NYSE:BABA) marketplaces. Mobile accounted for 42.9% of the total.
- BABA -1.6% premarket. While Alibaba's latest figure suggests its Singles Day GMV is on pace to easily beat initial analyst forecasts of ~RMB50B, expectations grew yesterday following a strong start to China's biggest online shopping day; shares rose 4% on Monday
- Separately, vice chairman Joseph Tsai says Alibaba is open to partnering with Alipay rival PayPal (NASDAQ:EBAY) as it tries to expand its international reach. "If you look at our footprint of being the largest online payment company in China, and PayPal’s position of having a very good international position ... these are some complementary footprints."
- EBAY +0.6%. Alibaba's international sales (skewed towards wholesale business for now) rose 38% Y/Y in calendar Q3, and made up 11% of its total revenue. eBay's upcoming PayPal spinoff has fueled hopes PayPal will be able to strike more deals with companies competing against eBay's Marketplaces ops (such as Alibaba).
Tue, Nov. 11, 1:51 AM
- Without specifying a timeline for when the unit might list, Jack Ma has announced that Alibaba's (NYSE:BABA) Alipay "will definitely go public."
- "The main goal of listing isn't for more money, but to let more people share in and be part of it," says Ma.
- Meanwhile, Alibaba's Singles' Day shopping festival has already surpassed last year’s record of 36.2B yuan ($5.9B) with still more than 10 hours to go in the annual 24-hour discount event.
- Previously: Alibaba, peers rally; strong Singles Day activity reported
- BABA -1.6% AH
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