Cantor Loves Alibaba Following Record-Setting Singles Day

• Shares of Alibaba Group Holding Ltd BABA have appreciated 16.21 percent over the past month, reaching a high of $85.88 on November 5.
• Cantor Fitzgerald’s Youssef Squali has maintained a Buy rating and price target of $90 on the company.
• The total GMV for the company’s Singles Day on November 11 amounted to a record $14.3 billion, reflecting a 54 percent increase year on year.

Analyst Youssef Squali believes that given that this year’s performance was record breaking performance not only for Alibaba but for the overall ecommerce industry, it would “1) allay fears of the impact the broader Chinese economic slowdown is having on Chinese consumers in general, and Alibaba in particular, and 2) be a positive early read into BABA's Dec. quarter results.”

Alibaba’s Singles Day performance beat expectations of GMV worth $13 billion, with Alipay processing 710 million transactions, reflecting 140,000 transactions per second at the peak. Cainiao Logistics delivered 467 million orders.

According to the Cantor Fitzgerald report, “This year's sales are being closely monitored, in part because of concerns around China's waning economic growth, and its impact on the Chinese consumer; and in part because unlike prior years, Singles Day this year has been touted as a much more global event.”

Thirty three percent of the buyers purchased international products, while mobile was a strong driver of the performance, accounting for 69 percent of the total GMV.

“While there is likely a fair amount of push forward of purchases given the heavy discounting, we view today's performance as a strong indication for the quarter,” Squali added.