If you're interested in the Chinese stock market, Alibaba stock is probably an attractive growth stock to buy in 2022.
How much can you make with Alibaba stock?
Get up-to-date and precise information on Alibaba stock with its current price, dividend yield, analysis and our opinion.
This page is for information purposes only and does not constitute investment advice. Remember that investing can be risky.
Want to buy shares in Alibaba: Our key take-aways
Stock exchange: NYSE
- Stock market index: Nasdaq
- Dividend 2021: $0
- Dividend forecast 2022: $0
- 1 year performance: -48.28%
Should I buy Alibaba stock?
Buying Alibaba stock is a good growth and diversification strategy for your stock portfolio.
Indeed, even if Alibaba does not generate any income because it does not pay any dividend, its stock price could hold some nice surprises in the medium and long-term.
This is indeed what the analysts' consensus and fundamental analysis data suggest.
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How can I buy shares in Alibaba ?
To buy Alibaba on the stock market:
- Find an online broker offering stock investments.
- Open your trading account by filling out a simple form.
- Deposit funds into your account.
- Search for the stock
- Place a buy order to add Alibaba to your stock portfolio.
How much are Alibaba shares?
See price chart below to follow Alibaba stock price in real time.
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Why Alibaba shares could go up:
The Alibaba group shows several major strengths that correspond to elements in favour of a rise in its stock price including:
- *A strong domestic customer base: the Chinese customer base is particularly important since China has the largest population in the world. The group is also present in India, the country with the second largest population.
- An integrated business: Alibaba's business model is a Business to Customer, Business to Business and Customer to Customer model, which enables it to respond to the vast majority of its customers' transactions.
- Strong innovation: Alibaba's growth strategy is largely based on innovation, which tends to reduce its costs and give it a significant competitive advantage. The group currently holds 17,945 protected patents in China.
- A fast-growing market: the Asian markets in which the Alibaba group operates have been growing rapidly for the past ten years thanks to the emergence of the middle class and rising incomes.
- A strong community of resellers: in the retail sector of the group, the community of resellers is important and the companies using the group's platform are also numerous.
- Another interesting platform: Finally, we can also point out that Alibaba Group is leading another consumer-to-consumer sales platform in China, TaoBao, which has recently benefited from remote working and is growing rapidly.
Why Alibaba shares could go down:
The Alibaba group also has some weaknesses that are likely to cause a decline in its stock price in the near future:
- Counterfeiting problems: the protection of patents in China is lighter than elsewhere in the world and copies of products marketed by Alibaba are more and more numerous on the market. The group has invested more than 161 million dollars in order to minimize the appearance of counterfeits on its site.
- A delay in R&D: if the group has been extremely successful since its creation until today, largely thanks to its innovations, its competitors have also started to innovate and at a higher pace.
- A strong dependence on the Chinese market: the group still has little growth to develop on its domestic market and is still only marginally present internationally, which penalizes its sources of profit.
- Poorly diversified sources of revenue: it is of course the Chinese e-commerce market that still generates the largest share of the group's revenue, which exposes it to competition from new entrants.
- An antitrust lawsuit: finally, the group was recently fined 2.8 billion dollars after an antitrust investigation conducted by the Chinese government, which penalizes its brand image.
Can I buy Alibaba stock online?
Yes! You can buy Alibaba shares online. For many buys this is the best way to do it. Here's why:
- The commissions are lower
- You can choose your own investments
- You benefit from analysis and decision support tools
- You can invest in stocks directly or through derivatives like ETFs.
How can I sell my Alibaba shares?
With a traditional registered investment vehicle, you will not be able to short sell, so you can only sell Alibaba shares that you actually own.
But you can short Alibaba shares with a margin account. It is also possible to bet on the fall of the share price by using derivatives such as CFDs or options.
What investment vehicles in Canada can hold Alibaba stock?
Alibaba shares can be placed in several different savings vehicles including"
- RRSPs: these registered retirement savings plans offer funds that are accessible at the time of retirement and offer an income tax deferral.
- TFSAs: tax-free savings accounts is an incredibly popular short-and long-term tax-free investment vehicle.
- Margin accounts: This account offers leverage and allows you to borrow against the value of the securities you hold to make other investments. It allows you to sell short.
- Cash accounts: This account allows you to trade stocks on North American markets only.
An investor can buy Alibaba shares online from most brokers by simply placing a stock order on the stock.
It is also possible to make this investment as part of a diversification strategy by investing in a mutual fund or ETF or exchange traded fund.
Alibaba share price history over 10 years:
Alibaba dividends and payment dates
In 2021, Alibaba Group did not pay any dividend to its shareholders.
It is also worth noting that the company has never paid a dividend since it went public.
This lack of profit redistribution is largely explained by the company's recent entry into the stock market and its desire to make strategic investments to boost its growth.
Although no dividend has been announced for 2022 by the group, it is possible that it will decide to pay a dividend to its shareholders in the future.
What is the dividend yield for Alibaba over the last 10 years?
The yield on Alibaba shares is obtained by dividing the annual dividend by the annual average price.
A stock's yield provides key information about a company's dividend policy and its evolution over time and performance.
Annual gross shareholder return = Total dividend for the year ÷ average share price for the same year
The 10-year average return = Sum of annual returns ÷ 10
What analysts are saying about Alibaba stock:
A critical analysis of Alibaba stock:
Fundamental analysis of Alibaba's stock shows strong medium to long-term fundamentals with the following indicators:
- Excellent financial position: the company benefits from a strong financial position which gives it a significant investment capacity.
- Positive recommendations: the majority of analysts working on this stock recommend buying or overweighting it.
- Attractive price target: the average price target set by analysts is quite far from the current price, which suggests an interesting rise in the price of this stock.
- Above-expectation releases: Historically, Alibaba Group tends to release financial results above market expectations.
- Low EPS growth: On the other hand, Alibaba's low EPS growth estimate for the next few years is relatively weak.
- Declining earnings forecasts: analysts' forecasts for the group's future sales and earnings have been revised downward several times in recent months.
- Diverging opinions: finally, analysts' opinions regarding the price target for this share are quite divergent, which reflects a difficulty in evaluating the company and its activities.
A technical analysis of Alibaba stock:
As for the technical analysis of Alibaba stock, the signals are a bit more nuanced with the following indicators for the long-term:
- The RSI is currently at 35.584 and is therefore returning a strong sell signal on this stock.
- The short and medium-term stochastics are sending a sell signal on Alibaba and the long-term stochastic is sending an oversold signal.
- The MACD is currently negative and located at -23.99, which also sends a sell signal.
- The simple and exponential moving averages are all returning a sell signal for all time frames, except for the simple MA200 which is returning a buy signal.
- The next technical supports to watch for are at 93.73 and 82.26 and the next resistances are located at 123.01 and 140.82.
Who is Alibaba?
Alibaba Holding Limited is a Chinese company in the online retail sector. More precisely, the company is currently positioned as the leader of marketplaces in China. It offers a platform that allows individuals and businesses to buy and sell goods and services online.
Alibaba Group's business is organized into three divisions including:
- The operation of e-commerce platforms: the group owns the Alibaba, Taobao, Tmall, Juhuasuan, Aliexpress and 1688 websites.
- Online payment services: these services are provided through the Alipay platform.
- Other activities: including the development of price comparison portals, web interfaces and applications, cloud-based IT infrastructure management platforms and other solutions.
Revenues can be broken down into the following activities:
- The sale of e-commerce services generates 86.6% of revenue
- IT services generate 8.4%of revenuer
- Other activities generate 5% of revenue
Alibaba currently employs 251,462 people.
Who are Alibaba’s competitors?
The Alibaba group is currently one of the leaders in its sector of activity, but it must also face some major national and international competitors, including:
- Amazon: this American e-commerce group is one of the giants of the web. It was introduced on the stock market in 1997.
- JD.com: This Chinese company is also specialized in e-commerce and was formerly specialized in the sale of electronic devices. It now offers consumer products.
- Tencent Holding: this company is also a Chinese company specialized in internet and mobile services and online advertising. It is engaged in social networking, web portals, online shopping and multiplayer online games.
- Baidu: This Chinese Internet company operates a search engine that is the most visited site online today. It is also active in open source software, including artificial intelligence.
- Netease: this other Chinese company is specialized in Internet services and operates the 163 site which is a large Chinese web portal.
Who are Alibaba’s partners?
Since its IPO, Alibaba Group has established various partnerships with other large companies. Here are its recent partners:
- El Corte Inglés: one of the group's alliances is with the European department store chain in retail, payment and cloud.
- Bailian: another partnership was signed with Bailian, a commercial conglomerate that will allow Alibaba to strengthen its influence in physical commerce.
- Bolloré: the Chinese company has become a partner of the Bolloré group in a partnership that covers several areas. This global partnership aims to enable them to develop joint projects and explore new opportunities.
- Richemont: the Swiss luxury group has become a partner of the Chinese giant and the British marketplace Farfetch. Alibaba and Richemont have each invested more than $250 million in the operations of this third company in China.
- Accor: this leader in augmented hospitality has partnered with Alibaba to develop a range of digital applications and loyalty programs to enhance the experience of consumers and travelers.