Credit Suisse Is 'More Positive' Following Alibaba's First-Ever Analyst Day

Credit Suisse said it is incrementally more positive coming out of the Alibaba Group Holding Ltd BABA Investor Day, given better revenue guidance, more clarity on its Cainao and M&A strategy.

Analyst Dick Wei, who maintains his Outperform rating on the stock, said the company also issued better clarity on how it can use its ecosystem to provide branding services to merchants.

The Event And Takeaways

Alibaba Group hosted its first Investor Day on June 14 at its Hangzhou headquarters, where founder Jack Ma emphasized the company's vision to double its GMV to Rmb6 tn (US$1 trillion) by FY20 and cover 2 billion consumers by FY36.

Related Link: Alibaba Wants To Be Bigger Than Apple And Google...Combined

Wei said the senior management shared their vision to transform the business into a data company with a focus on globalization, rural development and cloud computing.

Alibaba guided for FY17 revenue of greater than Rmb150 billion (up 48 percent YoY) and greater than Rmb138 billion (up 36 percent YoY), excluding Youku and Lazada, versus consensus. Credit Suisse estimated growth rates of 39 percent and 31 percent, respectively.

"While Alibaba will only disclose annual GMV — not quarterly — it will provide segment-wise P&L numbers that reflect its broader value proposition," Wei wrote in a note.

Wei maintains his $100 price target on the stock, which is currently up 0.49 percent to $78.15.