Alibaba Looking To Extend 10-Week Win Streak

While U.S. tech giants Facebook Inc FB, Amazon.com, Inc. AMZN, Netflix, Inc. NFLX and Alphabet Inc GOOG GOOGL have gotten a lot of media attention for their share prices surging to new all-time highs in 2017, one of their largest Chinese counterparts has been delivering some major under-the-radar gains.

Refocusing On Alibaba

Alibaba Group Holding Ltd BABA shares were up another 1.4 percent Tuesday, trading above $118 for the first time since the weeks following its 2014 IPO. Alibaba shares are now up 53.7 percent in the past year and within a stone’s throw of the stock’s all-time high of $120 from November 2014.

Alibaba’s market returns have been remarkably consistent in 2017, even throughout a tumultuous March for most U.S. stocks. In fact, Alibaba is on track for its 11th consecutive week of gains if it finishes the week strong.

Without a major catalyst ahead until the company reports earnings on May 18, it appears as if a test of the $120 level is imminent. It wouldn’t be surprising to see Alibaba shares hover near the $120 level until May 18. The strength of Q1 earnings could dictate whether Alibaba breaks out to blue skies and new all-time highs or the $120 resistance holds.

Alibaba’s positive momentum has come is spite of market fears over the health of China’s economy and an ongoing SEC investigation into Alibaba’s accounting practices. Alibaba first disclosed the SEC investigation roughly a year ago and denied in November that the SEC was working with a high-ranking whistleblower within the company.

Alibaba has delivered revenue growth in the 44-48 percent rage in the past three quarters. Those staggering growth numbers top even its high-growth U.S. counterpart Amazon, which has reported revenue growth in the 22–29 percent range during that time.

Another strong quarter of revenue growth from Alibaba and/or an update on the SEC investigation could be enough to send shares smashing through the $120 level in coming weeks. However, negative SEC developments and/or any signs of slowing growth could send Alibaba back down to potential support at the stock’s 2016 high in the $110 range.

Update: The stock was down about 1.5 percent at $116.34 Wednesday afternoon.

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Image Credit: By Thomas LOMBARD, designed by HASSELL (architects)[1] (Own work) [CC BY-SA 3.0 (http://creativecommons.org/licenses/by-sa/3.0)], via Wikimedia Commons