Alibaba Q3: Munger Remains Unfazed, Plus 3 Things Not To Overlook

Nov. 20, 2022 1:51 AM ETAlibaba Group Holding Limited (BABA), BABAF6 Comments

Summary

  • Alibaba just reported its Q3 (fiscal year Q2) earnings. The results were solid despite challenges in the past quarter and triggered sharp price rallies.
  • In the meantime, the Daily Journal Corp.’s recent 13F shows that its Alibaba position remains unchanged in the past quarter.
  • This article focuses on the implications of 3 things from its Q3 earnings report: profitability, capital allocation, and valuation.
  • And I can see why Munger remains unfazed.
  • I do much more than just articles at Envision Early Retirement: Members get access to model portfolios, regular updates, a chat room, and more. Learn More »

Alibaba headquarter

maybefalse

Q3 recap and investment thesis

Alibaba (NYSE:BABA) just released its Q3 2022 earnings report (“ER”). Note that its fiscal quarter is shifted from the calendar quarter (so it is its FY Q2). And in the remainder of this article, I

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Source: BABA Q3 ER

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Source: Dataroma.com

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Source: author and Seeking Alpha.

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Source: author and Seeking Alpha.

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Source: author and Seeking Alpha data.

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Source: author and Seeking Alpha data.

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** Master of Science, 2004, Stanford University, Stanford, CA 

Department of Management Science and Engineering, with concentration in quantitative investment 

** PhD,  2006, Stanford University, Stanford, CA 

Department of Mechanical Engineering, with concentration in  advanced and renewable energy solutions

** 15 years of investment management experiences 

Since 2006, have been actively analyzing stocks and the overall market, managing various portfolios and accounts and providing investment counseling to many relatives and friends.

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Combined with Sensor Unlimited, we provide more than 3 decades of hands-on experience in high-tech R&D and consulting, housing market, credit market, and actual portfolio management. We monitor several asset classes for tactical opportunities. Examples include less-covered stocks ideas (such as our past holdings like CRUS and FL), the credit and REIT market, short-term and long-term bond trade opportunities, and gold-silver trade opportunities. 

I also take a holistic view and watch out on aspects (both dangers and opportunities) often neglected – such as tax considerations (always a large chunk of return), fitness with the rest of holdings (no holding is good or bad until it is examined under the context of what we already hold), and allocation across asset classes.

Above all, like many SA readers and writers, I am a curious investor – I look forward to constantly learn, re-learn, and de-learn with this wonderful community.

Disclosure: I/we have a beneficial long position in the shares of BABA, AAPL,ABBV either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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