Alibaba Presents a Rebuy Opportunity After Covered Calls
"Alibaba, our fourth stock, is one that I lost to covered calls but is now approaching my target entry price. I lost it around 140 per share and I'm hoping it falls back to that level to buy it back. Despite recent volatility, Alibaba is showing signs of a long-term rebound fueled by its massive AI push and operational streamlining. I remain patient, waiting for a better entry point where the fundamentals align with the price, allowing for significant upside over the coming years."
Paul discusses his experience with Alibaba, noting that he was forced out via covered calls and is now eyeing a re-entry at around 140. He cites the company's renewed focus on AI and operational improvements as catalysts for a long-term rebound.
Alibaba's Future Cloud Competition Risk
"Great comment here on Alibaba. I said it's an AI stock and the response was it is a cloud stock and they are building the infrastructure of the future. I cannot disagree on that. However, I'm just wondering who will be able to build the same cloud five years from now. Will there be competition? I have no idea. So, I'm just saying for me it's risky and I see a lot of players building it around the world. For now, it's going well."
The speaker discusses Alibaba, contrasting its portrayal as both an AI and a cloud stock. While acknowledging the company's role in building future infrastructure, he expresses uncertainty about its ability to maintain a competitive edge in cloud services over the next five years, labeling the investment as risky amidst increasing global competition.
Hold rating update for Alibaba stock
"So all that being said, to answer the question, should you buy Alibaba stock before the company announces earnings? I would say no. I would say this is not one of those situations where you want to get ahead of the earnings release when the valuation is not especially attractive. So I will be updating this hold rating for Alibaba stock. As you can see, I last updated this on October 15th when I downgraded the stock to a hold. And today on November 18th, I will reiterate that hold rating for Alibaba stock."
The analyst advises against buying Alibaba stock ahead of its earnings release due to elevated volatility and an overvalued price. The update to a hold rating follows a period of significant price appreciation that is not supported by improved fundamentals.
Alibaba Revamp Commentary Amid AI Push
"Yeah, we're seeing the shares of Alibaba head higher in the pre-market, up 4.2%. The Chinese e-commerce giant is preparing to overhaul its main mobile AI app to more resemble OpenAI's chat GPT. The revamp is also going to mark uh Alibaba's biggest move so far to try to ring revenue uh from more consumerf facing services in the app like adding aentic AI features which is essentially having the AI do your shopping for you in a way to monetize the technology. They do want to turn it into a more fully functioning AI agent and they do plan to eventually expand globally with a overseas version. So Alibaba ADRs headed higher after this announcement."
The speaker discusses Alibaba's plans to revamp its mobile AI app to mimic ChatGPT, marking its most significant move to monetize AI through consumer-facing services. The pre-market reaction, with shares up by 4.2%, indicates investor optimism surrounding this strategic pivot.
Company Commentary on Alibaba Amid Changing China Sentiment
"Alibaba, everybody was anti-China for the longest time. Chinas awful. Chinas terrible. I look at it going, China loves money. They love their middle class growing and becoming rich. And their rich love being richer. Yeah, theyre communists, but I just look at it going 20, 30 years down the road, will China be more free and wealthier than it is today? Yes, I think they will. So, the question becomes, is Alibaba going to benefit from that? Yes, they will. So, can I pay a reasonable price for Alibaba? Well, Alibaba is the biggest gainer out of all these companies this year. It is up huge. So, that has changed whether its a good investment or not. We will take a look at that at some point."
The speaker provides a contrarian view on Alibaba, countering longstanding negative sentiment towards China by emphasizing the nations growing wealth and consumer class. He suggests that Alibaba, having been the biggest gainer of the year, may benefit in the long run if its price is reasonable.