- Alibaba is breaking out above major resistance, and for good reason.
- China/U.S. trade deal tensions appear to be easing, the company continues to report extremely strong numbers, and the stock is cheap.
- Moreover, Alibaba is expanding its internet empire by developing numerous businesses, funding them by the tremendous cash flow it generates from its core commerce operations.
- Analysts seem to agree that the stock is undervalued.
- If the global economy remains stable, I see Alibaba moving towards $250 or higher within the next 6-12 months.
- This idea was discussed in more depth with members of my private investing community, Albright Investment Group . Get started today »
Alibaba's Beautiful Breakout
Alibaba's (BABA) breakout above $200 is significant, and it suggests the stock can go substantially higher from here. After hitting a post-IPO low of below $60, BABA had a stellar run-up, more than tripling in roughly 2 years. However, since then, BABA has been in a prolonged consolidation phase, and the stock finally looks ready to begin its next wave higher.
Image Source: StockCharts.com
Alibaba is expected to continue to grow revenues at roughly 30% per year in fiscal 2020 and in fiscal 2021. Considering the company's rapid revenue growth rate, the stock appears extremely cheap, trading at roughly 20 times forward earnings or lower (by my calculations). Additionally, Alibaba continues to expand its portfolio of businesses, diversifying in cloud, media/entertainment, and in other innovative initiatives and solutions.
At $200 per share, Alibaba remains an incredibly undervalued conglomerate likely to expand revenues, EPS, and its share price substantially in future years.
In a previous article, I wrote in August, I mentioned that Alibaba was a "Strong Buy Into Earnings". Since then, the stock has appreciated by about 22%. Nevertheless, despite the significant rise, the technical image remains very bullish.
Steem Account Status: Unclaimed
Are you Victor Dergunov? If so, you have a Steem account that is unclaimed with pending cryptocurrency rewards sitting in it from your content. Your account was reserved by the Steemleo team and is receiving the rewards of all posts syndicated from your content on other sites.
If you want to claim this account and the rewards that it has been collecting, please contact the Steemleo team via twitter or discord to claim the account. You can also view the rewards currently sitting in the account by visiting the wallet page for this account.
What is Steemleo Content Syndication?
The Steemleo community is syndicating high-quality financial content from across the internet. We're also creating free Steem accounts for the authors of that content who have not yet discovered the Steem blockchain as a means to monetizing their content and we're listing those accounts as the 100% beneficiaries to all the rewards. If you want to learn more about Steemleo's content syndication strategy, click here.