what happened
Shares of Alibaba Group Holding Limited (NYSE: BABA) reflects today of a historic sell-off that the Chinese e-commerce share lost 30% of its value in just two months. As of 10:55 EST, Alibaba shares are up 6% from yesterday’s lowest month.
Approximately
Suffice it to say that this is a strange development on a day when The Wall Street Journal just reported that ‘regulatory risks” extended ‘Christmas Eve’ sale at Alibaba expanded, describing how the cancellation of a planned exchange of Alibaba’s Ant Group subsidiary and an antimonopoly investigation in China combined to give Alibaba $ 273 billion to cost market capitalization a few months. Referring to analysts, the Magazine warned that pressure on Alibaba as well as Ant was “increasing”, and that regulators had instructed the latter to focus on the original payment industry and stop expanding into new – and more lucrative – business areas as they arose. Of loans. .
It is said, even the Magazine acknowledges that investors are overreacting to fears of regulation, and that it is “not in China’s interest to dismantle or destroy such a lucrative business.”
Image Source: Getty Images.
Now what
And that is perhaps the sentiment that is lifting Alibaba shares today.
As TheFly.com reported today, Truist Financial (the former BB&T) only went out with a letter to analyze what Alibaba might be worth based on a “sum of the parts” valuation, in case the company is broken up. The analyst concluded that such a breakdown was ‘unlikely’, and that even if it did, a crumbling Alibaba would still have its shareholders in possession of shares worth at least $ 294 in total – and thus 25 % more than what Alibaba shares are currently selling for.
The analyst further noted that Alibaba is now so important to the Chinese economy that it has become a “must” for buyers, and therefore will remain very profitable, whether it is apart or not. It is apparently based on this assurance that Alibaba investors returned today to buy the share.