Forex Brokers Award 2020
Vote your favourite broker
Trade 100 Bonus - the best offer on Forex market

Alibaba (BABA) Close to Five-Month Highs Ahead of 2019 Largest Stock Offering

Nov 26 2019, 10:23 AM (+06) | ATFX

Alibaba after a strong earnings report in November plans to issue 500 million new shares plus an additional 75 million “greenshoe” option next week. The greenshoe gives the underwriters the ability to sell more stocks than the original amount set, of those 500 million shares, the 50 million shares will be sold to retail investors. BABA said those retail shares will be priced at no more than 188 HK. The offer price for both the international and the Hong Kong public offering has been set at HK$176 per share. BABA’s Hong Kong listing will be the largest stock offering across the globe for 2019.

The BABA stock price performance has run an impressive rebound since the June lows and registering 22% gaIns for the year, while the S&P 500 is gaining 23% the same period.

BABA beat market consensus expectations in the November earnings report. Revenue was RMB119,017 million (US$16,651 million), an increase of 40% year-over-year. The Annual active consumers on the China retail marketplaces reached 693 million, an increase of 19 million from the 12 months ended June 30, 2019.  

Mobile MAUs on the company’s China retail marketplaces reached 785 million in September 2019, an increase of 30 million over June 2019. Income from operations was RMB20,364 million (US$2,849 million), an increase of 51% year over year. Adjusted EBITDA, increased 39% year-over-year to RMB37,101 million (US$5,191 million). The non-GAAP diluted earnings per ADS was RMB13.10 (US$1.83), an increase of 36% year-over-year.

BABA Cloud computing revenue increased by 64% (YoY) to RMB9,291 million (US$1,300 million) during the September quarter, driven by an increase in average revenue per customer. As of August 4th 2019, 59% of companies listed in China are customers of Alibaba Cloud.

Despite the trade tensions between US and China, BABA managed to avoid damage in the bottom line as it’s wide diversification helps the company to preserve the revenues and earnings. Alibaba has rolled out various services aiming to eliminate the trade war impact on its bottom line.


Alibaba Valuation is still Attractive

Alibaba stock trades at 22.37 P/E making the BABA stock attractive against its competitors, BABA’s Enterprise Value to EBITDA is 28.70, compare this to Amazon’s 26.07. This makes Alibaba stock cheap on a P/E basis, but slightly overvalued on an EV/EBITDA basis.


Alibaba BABA Technical Analysis

On the technical analysis side, the picture is bullish as BABA is trading above all the major daily moving averages and continues above the ascending trendline which started in January 2019. Traders now focus to the upside, where immediate resistance for BABA stands at $186.89 the top from November, while if the stock breaks above that level, the next target will be the resistance at 188.40 which is the high from November 8th  before an attempt to yearly highs.

On the other hand, Alibaba stock will find first support at $181.30 the low from November 20, while extra bids will emerge at $176.39 the 50-day moving average. In case the stock breaks below that level bears will target the 100-day moving average at $173.61.

Information provided by and ATFX, Market Strategist: Nikolas Papas
Legal: AT Global Markets (UK) Limited is authorised and regulated by the Financial Conduct Authority (FCA) in the United Kingdom. FCA registration number (760555). Registered Office: 32 Cornhill, London, EC3V 3SG. Company No. 09827091


About ATFX A global award-winning forex broker, ATFX was established with the aim of providing a robust online trading platform for retail traders interested in trading, forex, cryptocurrency, precious metals and energy CFDs and. Today, the company, headed by an elite management team, has a global presence and offers a wide range of trading products. To ensure a seamless trading experience, the company offers MetaTrader 4, the most popular trading platform in the world, while connecting MT4 with the top liquidity providers with the latest bridging technologies. Due to its client-focus, ATFX also offers free access to market research, courses for all levels of trading, from novices to advanced levels, 24/5 live help and customer support, and highest level of protection for traders. Awards The outstanding performance of ATFX in our services have gained recognition from the market. During the year under review, the brand achieved over 20 international awards in 2018, included FX Broker of the Year, UK, Fastest Growing Forex Broker, Europe and Best Trader Education Service Provider. It regarding service, trading instruments, and the development in recognition of its commitments to excellent service to traders in corporate governance. Staffs are ATFX’s most valuable asset With close to 400 employees in offices around the globe, it aims to establish a strong footprint. ATFX now has websites in multiple languages tailored to each of the regions it serves and aims to provide the best-in-class products and services. From its user-friendly online trading platform to its multi-lingual customer support, offered by skilled and experienced professionals, ATFX takes pride in providing a safe and easy trading environment along with prompt help in the language that local traders (e.g. Europe, China, Southeast Asia …) are most comfortable in. Investors Education Following nearly 500 seminars that were successfully held during the last 12 months. ATFX has continued its principled commitment of educating its investors by conducting a series of seminars across the world, which are free and educate its participants about various trading techniques and helps learn the basics of risk management. It looks to provide a holistic service which includes the trading platform, along with a team of skilled and experienced professionals, allowing clients to gain access to comprehensive trading services. Website:www. Hotline: 0080 112 7901 [email protected] [email protected] Legal: ATFX is a trading name of AT Global Markets Limited (ATGM, registration number 24226 IBC 2017). ATGM is an International Business Company in Saint Vincent and the Grenadines. Registered address is : the Financial Services Centre, Stoney Ground, Kingstown, St.Vincent& the Grenadines.