Consider This Before Taking a Position in Alibaba (BABA)

By Chris Stiles • Thursday, February 20 10:08 • Permanent Link

We're taking a closer look at Alibaba today, as the chatter surrounding the stock has increased notably in the last few weeks. Today, its shares moved 11.6% compared to -1.0% for the S&P 500. Increased investor interest and volatility surrounding the stock are not reason enough to buy in -- you should first perform your own due diligence. Here are some figures that can get you started:

Alibaba Group Holding Limited, through its subsidiaries, provides technology infrastructure and marketing reach to help merchants, brands, retailers, and other businesses to engage with their users and customers in the People's Republic of China and internationally.
Alibaba has moved 65.3% over the last year compared to 20.8% for the S&P 500 -- a difference of 44.5%
BABA has an average analyst rating of buy and is 13.64% away from its mean target price of $123.55 per share
Its trailing 12 month earnings per share (EPS) is $4.86
Alibaba has a trailing 12 month Price to Earnings (P/E) ratio of 28.9 while the S&P 500 average is 29.3
Its forward earnings per share (EPS) is $9.87 and its forward P/E ratio is 14.2
The company has a Price to Book (P/B) ratio of 0.34 in contrast to the S&P 500's average ratio of 4.74
Alibaba is part of the Consumer Discretionary sector, which has an average P/E ratio of 22.6 and an average P/B of 3.19
Alibaba has on average reported free cash flows of $25.68 Billion over the last four years, during which time they have grown by an an average of 7.4%

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.