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Alibaba - AI Stock Analysis

Analysis generated September 12, 2024

Alibaba Group Holding Limited (NYSE: BABA) is a multinational conglomerate holding company specializing in e-commerce, retail, internet, and technology. Founded in 1999 by Jack Ma, Alibaba has grown into one of the world's largest retailers and e-commerce companies. The company operates various business units, including Alibaba.com, Taobao, Tmall, and Alibaba Cloud. Alibaba serves millions of consumers and businesses in more than 190 countries and regions, offering a broad spectrum of products and services.

Fundamental Analysis

In the latest quarter, Alibaba reported a revenue of CNY 243 billion. This represents an increase of 9.63% compared to the prior quarter, which is a positive sign indicating growth momentum. On a year-over-year basis, revenue increased by 3.88%, indicating a slower but steady growth trajectory.

The net income for the last quarter was CNY 24.4 billion, a staggering increase of 624.81% compared to the prior quarter. However, this figure represents a decrease of 28.77% when compared to the same quarter last year, which could be a cause for concern. This fluctuation indicates a highly volatile earnings situation.

EBITDA for the last quarter was reported at zero, a significant decrease of 100.00% both quarter-over-quarter and year-over-year. This metric demands close scrutiny as it shows a severe dip in core profitability.

Alibaba's current P/E ratio stands at 21.27. This is within a normal range, indicating that the stock may be fairly valued. It is neither highly undervalued nor overvalued, providing a neutral stance from a valuation perspective.

Technical Analysis

Today, Alibaba's stock price is $85.49, an increase of 5.66% compared to a month ago, indicating a positive short-term trend. Year-over-year, the stock has risen by 1.04%, suggesting a positive long-term trend as well. The overall trend is bullish.

The current SMA10 is $82.63, slightly higher than the previous SMA10 of $82.41, indicating a potential upward price movement. The RSI is at 43.6, which is a neutral reading. This suggests that the stock is neither overbought nor oversold at this time.

Alternative Data Analysis

Based on data from popular job boards, Alibaba currently has 760 open positions, a downturn of 22% over recent months. This reduction suggests a company focused on improving margins or cutting costs, which may not be ideal for a growth-oriented company. Business outlook sentiment is also down by 12% over the past few months, another worrisome indicator.

In terms of customer acquisition, Alibaba's website attracts around 91 million visitors monthly, with no significant change recently. However, daily mobile app downloads stand at approximately 89,000 but have declined by 12% in recent months, signaling a potential loss in customer base.

Concerning customer engagement, Alibaba has 11 million Instagram followers, an increase of 10% in the last few months, indicating growing interest. However, their Twitter following remains stable at 250,000, with no meaningful increase or decrease.

According to AltIndex's AI score, which tries to predict stock price movements based on integrated analysis, Alibaba scores 39, categorizing it as a sell signal.

Conclusion and Recommendation

Summarizing all data points, Alibaba portrays a mixed picture. The company shows strong revenue growth and a positive short-term price trend, but fluctuating net income, zero EBITDA, and declining job openings pose significant risks. The technical indicators show a bullish trend, tempered by neutral RSI readings. Alternative data analysis adds another layer of concern, with declining job postings and mobile app downloads.

Given these mixed signals and the AI score recommending a sell, we caution potential investors and recommend maintaining a hold position or possibly selling if you seek less-risky investments.

Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.