Question

Give 3 reasons Why Alibaba stock is a buy? give examples

Answer 1

Three reason why Alibaba stock is a buy are as follows-

A. Alibaba is second largest electronic E-Commerce company in the world after Amazon and it is clocking a significant growth of almost 50% year on year so it makes a healthy buy.

B. Alibaba is also trading at a significant lower price to earning ratio than that of Amazon who is its biggest competitor so it is having a significant upside if it is provided with 50% of the price to earning of Amazon because Amazon is trading at a price to earning ratio of almost 120 whereas Alibaba just training at a price to earning of 30.

C. Alibaba is also yet to penetrate a large number of global Markets and it is also starting to diversify itself so it will offer the investors a better perspective of investing outside the American market and maximising rate of return.