May 21, 2021

Alibaba is one of the largest technology companies in China and its stock has been down nearly 35% since it reached all-time highs last October. Some of the runoff in the stock price was justified given the pace the stock was running up at, but investors are starting to turn on the stock calling this an overcorrection. BABA’s most similar stateside comparison is Amazon and the stocks were tightly correlated until December, and investors think BABA’s stock should resume its correlation. Finally, BABA’s current P/E is 24.46 and near its annual low. Its previous P/E low sparked a rally in BABA $319.32 in the following four-month period. 

FINSUM + Magnifi:  The best arguments for BABA are its incredibly cheap P/E and historic relationship to Amazon. It’s hard to ignore that much value even at this price.

Other news today: These Tech Stocks Will Thrive in this Volatility and Emerging Markets Key to ESG Outperformance

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