Yahoo owns 24% of Alibaba Group.
Tmall’s revenues should hit $120 billion by 2017, according to Euromonitor. Amazon’s revenues will likely be $100 billion by then.
For 2012, Alibaba Group – as a whole – is expected to do $40 billion in revenue while Amazon should do $60 billion.
Each percent of Alibaba Group is worth $1 billion at IPO.
Fantasy numbers are always fun. Just too bad how easy it is to check those that are part of a SEC filing. Like for 2012, Alibaba Group – as a whole – is expected to do $4 billion not $40 billion. Total revenue for the first 6 months of 2012 was just under $1.9 billion and no sane person thinks they can make over $38 billion the other 6 months. Alibaba Group total revenue for 2011 was reported $2.8 billion.
You have been perpetually wrong on Alibaba, and are wrong again. The Euromonitor report reflects Gross Merchandise Value transacted on the platform, which Tmall will overtake AMZN in during 2015. They report revenue differently, with AMZN reporting Gross revenue and Alibaba reporting Net revenue in the Yahoo financials. The businesses are directly comparable at the operating profit level. The crazy thing is that Alibaba did $374mm in operating profit in the June quarter alone and AMZN is forecast to do $500mm in operating profit for all of 2012. Alibaba not only blows away Amazon in revenue growth today (70% year-over-year vs. 30%), but it demolishes AMZN in terms of profitability. Better growth and much better absolute profits today than AMZN. Alibaba valued at $40bn via Yahoo, AMZN valued at $114bn. One of those two sounds pretty cheap.
Amazing how one forgets that LITERALLY two weeks ago we seen AG have $732M for 3 quarters and will have $1B in profit for the year. While I've argued its value for 4 YEARS I don't think it'll IPO at $100B, way too rich for an investor as that is assuming 100% growth EVERY YEAR for the next 3yrs. Law of diminishing returns is starting to take hold making it difficult to continue at its rapid pace.
Here's the best part.
Yahoo (YHOO) currently owns 24% of Alibaba Group, even after reducing its stake earlier this year. If Yahoo held on to its stake for the next year or so until Alibaba Group is valued at least at Amazon’s current market cap, Yahoo’s stake would be worth over $27 billion. Yahoo’s current market cap for the entire company including its Alibaba stake is only $22 billion.
Jackson is being conservative.