Analysts claim that investors may develop a growing interest with Alibaba as it experienced a soaring 45 percent increase in its shares in August 2019 and is not at 32.5 per share. It was also revealed that the group would be aggressive towards its globalized expansion where Ant Financial would take the lead to boost its valuations.
Alibaba has gained a 53 percent increase in its stock compared to last year's merely 45 percent growth, reported Nasdaq. It was stated that the group has fundamental developments in mind for 2020 and beyond which would put their stock position to touch the $300 per share mark within the next 12 months.
The analyst claimed that such a result would show a 30 percent growth, the third increase that the group has experienced since last year. The upside from all current levels was described as imminent as the company instills an aggressive strategy towards its global expansion that would result in triggered sustained positive momentum.
Alibaba's growth was blamed on its company-specific factors. Additionally, the analyst claimed that the easing tensions between China and the US regarding the trade deal restored consumer confidence and increased consumer spending on online retail sales. The industry experienced a 16.6 percent increase based on annual values. Alibaba, as one of the players in this industry, significantly benefited, senior research analyst Faisal Humayun of Investor Place commented.
Moreover, he discussed that although China had lower GDP growth last year, online sales were experiencing a healthy business environment. There were gains for companies that a higher year-on-year sales growth is still expected by 2020.
He also hinted that Alibaba could experience consistent and the former owns substantial growth due to Ant Financial where 33 percent of the latter's equity stake. Alibaba's stake is at $50 billion over Ant Financial's $150 total equity. Humayun claimed that it could generate a higher initial public offering within the next 12 to 24 months. He added that this could mean that Ant Financial is bound for value unlocking.
Moreover, Humayun also added that Alibaba's Ant Financial is very aggressive with its global expansion. It already enjoys a strong presence in China and India, countries that cater to 2.5 billion people. He said that expanding beyond these countries could mean immense growth potential for Ant Financial, which would also reflect on Alibaba's growth as well.
It was further discussed that Alibaba's core commerce is the main key cash flow driver of the brand. Humayun claimed that the expansion of its services to China's tier-two and tier-three cities would likewise substantially improve its growth potential and maintain its annual increases of stock value.
