Average price target of $231.20 for BABA stock
China’s (FXI) Internet giant Alibaba (BABA) is currently trading at $175.01, which is 6.6% above its 52-week low of $164.25 and 17.3% below its 52-week high of $211.70. The stock has generated returns of 1.5% since the start of this year and has declined close to 6.0% in the last three months.
Of the 45 analysts tracking Alibaba, 43 recommended a “buy,” two recommended a “hold,” and there was no “sell” recommendation on the stock. The average 12-month price target for Alibaba is $231.20, which indicates that the stock is trading at a discount of 32.0% to analysts’ estimates.
Estimates for high revenue growth
Alibaba (BABA) stock has already generated absolute returns of over 90.0% since its IPO in September 2014. Alibaba is looking to integrate online and offline shopping. The company recently launched outlets known as Hema Stores, where customers can place orders for shopping, groceries, and dining from mobile phones.
Alibaba also acquired an 83.0% stake in Southeast Asia’s leading online retailer, Lazada, for $4.0 billion. Lazada is operational in emerging Asian markets such as Malaysia, Indonesia, Thailand, the Philippines, Singapore, and Vietnam. Alibaba believes these markets to be lucrative, as first-generation Internet users are expected to boost online shopping.
Analyst Rob Sanderson of MKM Partners noted that the firm has a price target of $280.00 for Alibaba and stated, “We think Alibaba is years ahead of any competitor in driving digital commerce forward.”
Sanderson continued, “Of greater consequence is Alibaba’s foray into digitizing offline commerce (new retail), which we think is even further ahead and has potential to multiply Alibaba’s addressable market.”
Alibaba’s revenues are expected to grow 59.0% year-over-year to $58.1 billion in fiscal 2019 and 38.0% year-over-year to $80.27 billion in fiscal 2020.