Buy The Dip In Alibaba? Credit Suisse Thinks So, And Maintains Its $114 Target
In a report published Wednesday, Credit Suisse analyst Dick Wei maintained an Outperform rating and $114 price target on Alibaba Group Holding Ltd (NYSE: BABA). The analyst believes that the recent decline in the share price offers an attractive buying opportunity.
The analyst believes that the 12 percent decline in Alibaba's share price since June 1 is mainly due to liquidity issues in the Chinese stock market. However, since the U.S. stock market has more normal liquidity and given the strong business fundamentals of the company, the analyst believes that investors should accumulate the stock.
Related Link: Alibaba Pounded To New All-Time Low On Monster Volume
"Since Jan, we have been more conservative on BABA in the near term (despite good CY1Q15 results), given search algorithm changes and concerns over mobile monetization," Wei said, while explaining that there were several drivers for the stock in 2H15.
The drivers for the stock in the latter half of the year include "(1) ad load increase on its mobile apps, (2) Tmall GMV mix to increase and hence take rate improvements, and (3) progress in PC search ad optimization," according to the Credit Suisse report.
Latest Ratings for BABA
|Jan 2017||Bernstein||Initiates Coverage On||Outperform|
|Jan 2017||Standpoint Research||Upgrades||Hold||Accumulate|
|Nov 2016||Brean Capital||Maintains||Buy|
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