Alibaba was China's most valuable company throughout most of 2020, and planned to finish the year with a bang by rolling out its much anticipated Ant Financial IPO. Then Chinese regulators stepped in.
In a crushing blow to both companies, China's top commerce regulator announced an investigation into Alibaba's business practices, alleging the company may be abusing its dominant market position for monopolistic purposes. A few days later, the Chinese central bank (the PBOC) issued a statement criticizing Ant Financial's business practices, ordering the company to focus on its less-lucrative digital-payments business. Alibaba owns one-third of Ant, and both were founded by Jack Ma.
When brings me to the next part of this story - whether China's actions against Alibaba and Ant were tied to the government's disapproval of Jack Ma's recent statements criticizing China's oversight of businesses. Retaliation seems a likely motive for the punitive measures against Alibaba, and Nomura research analysts note that China may also be using Alibaba's case to send a warning shot to other dominant technology companies acting anticompetitively.
Alibaba's shares have plummeted on the news, erasing nearly all of its stock market gains for 2020. It's U.S. counterparts are most closely Amazon and PayPal, and Tickeron's Artificial Intelligence analyzes all three below.
BABA moved below its 50-day moving average on May 18, 2023 date and that indicates a change from an upward trend to a downward trend. In of 38 similar past instances, the stock price decreased further within the following month. The odds of a continued downward trend are .
The Momentum Indicator moved below the 0 level on May 24, 2023. You may want to consider selling the stock, shorting the stock, or exploring put options on BABA as a result. In of 88 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
The Moving Average Convergence Divergence Histogram (MACD) for BABA turned negative on May 24, 2023. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 53 similar instances when the indicator turned negative. In of the 53 cases the stock turned lower in the days that followed. This puts the odds of success at .
The 10-day moving average for BABA crossed bearishly below the 50-day moving average on April 25, 2023. This indicates that the trend has shifted lower and could be considered a sell signal. In of 14 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where BABA declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
BABA broke above its upper Bollinger Band on May 17, 2023. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Aroon Indicator for BABA entered a downward trend on May 18, 2023. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
The RSI Indicator points to a transition from a downward trend to an upward trend -- in cases where BABA's RSI Oscillator exited the oversold zone, of 38 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .
The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 3 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where BABA advanced for three days, in of 279 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating slightly worse than average price growth. BABA’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.439) is normal, around the industry mean (18.894). P/E Ratio (20.243) is within average values for comparable stocks, (72.605). Projected Growth (PEG Ratio) (0.721) is also within normal values, averaging (2.605). Dividend Yield (0.000) settles around the average of (0.039) among similar stocks. P/S Ratio (1.689) is also within normal values, averaging (8.407).
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. BABA’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 95, placing this stock worse than average.
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
an online and mobile commerce company
A.I.dvisor indicates that over the last year, BABA has been closely correlated with JD. These tickers have moved in lockstep 81% of the time. This A.I.-generated data suggests there is a high statistical probability that if BABA jumps, then JD could also see price increases.
|JD - BABA|
|BZUN - BABA|
|PDD - BABA|
|DADA - BABA|
|VIPS - BABA|