JD - JD.com, Inc.

NasdaqGS - NasdaqGS Real Time Price. Currency in USD
-0.41 (-1.42%)
At close: 4:00PM EDT

28.50 0.00 (0.00%)
After hours: 7:13PM EDT

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Previous Close28.91
Bid28.31 x 4000
Ask28.50 x 2900
Day's Range28.08 - 28.72
52 Week Range19.21 - 40.21
Avg. Volume15,915,439
Market Cap41.558B
Beta (3Y Monthly)1.32
PE Ratio (TTM)193.88
EPS (TTM)0.15
Earnings DateAug 14, 2019 - Aug 19, 2019
Forward Dividend & YieldN/A (N/A)
Ex-Dividend DateN/A
1y Target Est33.37
Trade prices are not sourced from all markets
  • JD.com's logistics arm raises a $218 million investment fund
    TechCrunch18 hours ago

    JD.com's logistics arm raises a $218 million investment fund

    Limited partners in the new fund include JD Logistics and JD.com, as well as undisclosed listed companies and government-led funds, reported Reuters. A company spokesperson told TechCrunch that the fund will focus on smart logistics and smart supply chain technology. JD Logistics, which became a standalone subsidiary in April 2017, has a lot to prove.

  • Another Retailer Crumbles in China as e-Commerce Sales Rise
    Market Realist9 hours ago

    Another Retailer Crumbles in China as e-Commerce Sales Rise

    French retail giant Carrefour has agreed to sell an 80% stake in its China operations for ~$705 million to Suning.com, an Alibaba-backed company. While China represents a massive opportunity with its almost 1.4 billion population, it has not been an easy market for foreign companies, at least when it comes to retail and e-commerce.

  • How Do Analysts View JD.com Stock?
    Market Realistyesterday

    How Do Analysts View JD.com Stock?

    Of the 37 analysts tracking JD.com, 32 have recommended “buys,” four have recommended “holds,” and one has recommended “sells.” Analysts have a 12-month average target price of $33.23 on the stock, which indicates a potential upside of 17.6% from its current price.

  • How JD.com Is Looking to Diversify Revenue
    Market Realistyesterday

    How JD.com Is Looking to Diversify Revenue

    While e-commerce remains JD.com’s (JD) primary business segment, the company is looking to diversify its revenue streams. JD.com is targeting verticals like logistics to drive revenue growth. Though it's a low margin business, JD.com is optimistic about gaining rapid traction in this space.

  • Will JD.com Mirror Amazon’s Spectacular Rise Going Forward?
    Market Realistyesterday

    Will JD.com Mirror Amazon’s Spectacular Rise Going Forward?

    JD.com (JD) is one of China’s premier e-commerce companies. Known as China’s Amazon (AMZN), JD.com is focused on growing market share and scale. Currently, JD.com’s GAAP margins are pretty slim. In the last reported quarter, gross margin was just 15.0%.

  • Logistics unit of JD raises 1.5 billion yuan investment fund

    Logistics unit of JD raises 1.5 billion yuan investment fund

    Chinese e-commerce giant JD.com's logistics division has raised a 1.5 billion yuan ($218 million) fund to invest in companies and technologies specializing in logistics, the company said on Monday. The fund's limited partners will include JD Logistics and the JD.com mother company, in addition to "several listed companies and government-led funds," the company said, declining to elaborate. JD.com's property management division also has a fund, established in February 2019, to invest in warehousing facilities.

  • Carrefour Sells Control of China Business at a Discount

    Carrefour Sells Control of China Business at a Discount

    (Bloomberg) -- Carrefour SA has agreed to sell an 80% stake in its China unit for 4.8 billion yuan ($698 million) in cash to local retailer Suning.com Co. as it rethinks its exposure in the world’s No. 2 economy after years of decline.The yielding of control comes after a long search for a partner for the French company’s struggling Chinese operations. Once the premier foreign supermarket chain locally, it failed to adjust to the onslaught of e-commerce in recent years and sales slumped.The shares rose as much as 2.9% early Monday in Paris.Carrefour will retain a 20% stake in the China business, which generated net sales of 3.6 billion euros (28.5 billion yuan) in 2018. It will also get two seats out of seven on the China unit’s Supervisory Board, according to a statement Sunday. The valuation of Carrefour’s China unit at 0.2 times its 2018 sales -- compared to an industry average of 0.8 times -- is at a “significant discount to peers likely due to poor financial results,” said Citigroup Inc. analysts led by Lydia Ling in a note Monday.“The consolidation in store network, supply chain, logistics and membership could improve efficiency and profitability for both parties,” said the Citi note.A growing number of European and American retailers are either scaling back their presence or tying up with local partners in order to stay competitive in China, where e-commerce penetration is one of the highest globally. Walmart Inc., which has a network of around 400 supermarkets, relies on JD.com Inc. for its delivery service, while Germany’s Metro AG is said to be trying to offload a majority stake in its Chinese business.“The big problem for Carrefour and other western grocery chains is that they have major challenges in their home countries and can’t afford to grow in China,” said Pascal Martin, a Hong Kong-based partner at OC&C Strategy Consultants. “In China, if you want to grow in the groceries space, you have to continue to invest capital in less developed cities.”End of an EraIt’s the end of an era for one of the first foreign brands to gain a loyal following among Chinese consumers. Carrefour entered the country in 1995, ahead of Walmart, and its massive hypermarkets where one could buy fresh pork along with a TV ushered in a new style of shopping for a country just opening up to the outside world.But it has struggled to maintain profitability as buyers moved online rapidly in recent years, a shift that’s favored home-grown giants like Alibaba Group Holding Ltd. Despite efforts to digitize its operations, and an initiative to rent out store space to local retailer Gome Retail Holdings, Carrefour’s China sales declined about 10 percent last year to 3.6 billion euros, according to the company’s annual report.Earnings before interest, tax, depreciation and amortization were 66 million euros or 516 million yuan last year. It operates 210 hypermarkets and 24 convenience stores in China currently.The transaction represents an enterprise value of 1.4 billion euros ($1.6 billion) for Carrefour China. For Nanjing-based Suning, primarily an electronics retailer, the deal will help it cut procurement and logistics costs and boost profitability, the company said in a statement Sunday. Its Shenzhen-listed shares rose as much as 6.5% in early trading on Monday as investors rewarded the retailer for closing the deal at a low price.Alibaba holds a 20% stake in Suning and the two companies are closely allied. They’ve been investing in brick-and-mortar retailers with the goal of building an empire where offline and online shopping are seamlessly integrated. Earlier this year, Suning bought 37 department stores from Wanda Group, while Alibaba paid $2.9 billion in 2017 for a 36% stake in Sun Art Retail Group Ltd., China’s biggest supermarket chain. The Carrefour deal is likely to strengthen Alibaba’s foothold in the fiercely competitive groceries market in China.The acquisition has been cleared by Carrefour’s board and is expected to close by year end, but still needs approval from the Chinese regulator, said the companies.Carrefour’s decision to retain a 20% holding shows how China remains a strategic market for global retailers. Keeping that stake will allow it to maintain a foothold in an innovative retail market, a company spokeswoman said Sunday.(Updates with shares in third paragraph.)\--With assistance from Robert Williams.To contact Bloomberg News staff for this story: Geraldine Amiel in Paris at gamiel@bloomberg.net;Daniela Wei in Hong Kong at jwei74@bloomberg.netTo contact the editors responsible for this story: Rachel Chang at wchang98@bloomberg.net, Bhuma ShrivastavaFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Alibaba and JD.com Want to Lock in Merchants With Big Data Deals
    Motley Fool3 days ago

    Alibaba and JD.com Want to Lock in Merchants With Big Data Deals

    China’s two biggest e-commerce players are tethering more brands to their platforms with data services.

  • JD.com, Inc. (JD) Dips More Than Broader Markets: What You Should Know
    Zacks4 days ago

    JD.com, Inc. (JD) Dips More Than Broader Markets: What You Should Know

    JD.com, Inc. (JD) closed the most recent trading day at $29.06, moving -0.21% from the previous trading session.

  • GlobeNewswire4 days ago

    JD.com Selects Deloitte as its Independent Registered Public Accounting Firm

    JD.com, Inc. (JD) (the “Company”), China’s leading technology driven e-commerce company and retail infrastructure service provider, announced that, effective as of June 22, 2019, the Company engaged Deloitte Touche Tohmatsu Certified Public Accountants LLP (“Deloitte”) as the Company’s independent registered public accounting firm, to replace PricewaterhouseCoopers Zhong Tian LLP (“PwC”). The change of the Company’s independent registered public accounting firm was approved by the Audit Committee of its Board of Directors.

  • Why JD.com Stock Has Gained Close to 10.0% This Month
    Market Realist4 days ago

    Why JD.com Stock Has Gained Close to 10.0% This Month

    Chinese stocks have been volatile since the start of 2018 due to trade war escalations coupled with concerns over a slowing Chinese economy. President Trump has warned that the next round of tariffs will be decided on how the meeting with his Chinese counterpart goes.

  • JD Stock Continues to Surge on Results of the 6.18 Anniversary Celebration
    InvestorPlace4 days ago

    JD Stock Continues to Surge on Results of the 6.18 Anniversary Celebration

    Chinese e-commerce giant JD.com (NASDAQ:JD) has had a big week. JD.com stock is seeing growth in the 7% range since Monday. Keeping the party going, JD stock is also getting a continued boost from the record-breaking results of the company's 6.18 anniversary sale.Source: JD.com JD Stock Gets Boost From Record-Breaking 6.18 SaleAmazon (NASDAQ:AMZN) has its yearly Prime Day sale, where it pulls out all the stops. The company doesn't release dollar figures for the event, sticking instead to the number of items shipped on the day, but last year it was estimated that shoppers would spent $3.4 billion, making Prime Day the e-commerce giant's single biggest shopping day.JD.com also has a big yearly shopping event it calls the "6.18 anniversary sale." The name is a little deceptive -- it sounds as though it is for a single day, June 18. However, it is actually several weeks worth of promotions, starting June 1 and running through to June 18. The company posted the results for this year's 6.18 sale on its blog and the impressive numbers have helped to boost JD stock.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * The 7 Best Dow Jones Stocks to Buy for the Rest of 2019 On Thursday, JD stock price hit $29.71, before settling down to close at $29.12 for a 1.61% gain on the day. Here are a few of the highlights for JD.com's record setting 2.18 sale: * $29.2 billion (U.S. dollars) transaction volume * Sold 2.8 million JD Plus premium memberships * Mobile phone sales up 100% year-over-year * 350 million boxes of milk sold * 91% of orders from JD.com fulfillment warehouses delivered same-day or next-day The Importance of Data-Driven ToolsIn its 6.18 blog post, JD.com spiked out the importance of its "Consumer to Manufacturer" or C2M initiative. The company provides data-driven tools to retail clients, including profiling buyers, targeted advertising and an AI-powered chatbot. And the new approach is showing encouraging results."This initiative employs big data and consumer insights, providing insights to brands to adjust their manufacturing and marketing approaches with the goal of providing consumers with products they want before they even know they want them. Transaction volume of new products and C2M products during 6.18 increased 289% compared with the same period last year. One out of every three monitors sold during this year's 6.18 campaign were C2M products. HP saw a 100% increase in sales of its Zhan 66 laptop, a C2M product, during 6.18."A Reuters feature about the new data driven services being rolled out by JD.com and competitor Alibaba (NYSE:BABA) notes that programs like C2M are critical for future growth. The companies have already largely "exhausted" online growth amid a Chinese e-commerce market that is growing saturated. For revenue to increase and JD stock to grow in value, the company needs to provide more value to merchant partners, increase customer loyalty, and convince those customers to buy more. In addition, if data-driven tools like C2M continue to provide value to merchants, the company has the opportunity to monetize them -- providing another source of revenue to help boost JD.com stock.It's nowhere near the $50 it topped to start off 2018, and still lags the $30 level it was trading at through much of the spring, but with a 1.61% gain on Thursday, JD stock is continuing a week of climbing back toward $30. It's up to $29.42 as of this writing.The results of the company's 6.18 anniversary sale are providing a boost, but the big data tools like C2M that were employed to help get those results should help JD stock price to keep growing.As of this writing, Brad Moon did not hold a position in any of the aforementioned securities. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * The 7 Best Dow Jones Stocks to Buy for the Rest of 2019 * 5 Boring Stocks to Buy This Summer * 7 S&P 500 Stocks to Buy With Little Debt and Lots of Profits Compare Brokers The post JD Stock Continues to Surge on Results of the 6.18 Anniversary Celebration appeared first on InvestorPlace.

  • A Look at JD.com’s Revenue and Earnings Growth
    Market Realist4 days ago

    A Look at JD.com’s Revenue and Earnings Growth

    China’s (FXI) Internet giant JD.com has risen just over 3.0% in the last five years. The primary driver of a company’s stock price is its revenue and earnings growth. JD.com has managed to grow sales at a robust pace over the years.

  • JD Shines on Its 21st Birthday
    Market Realist4 days ago

    JD Shines on Its 21st Birthday

    JD.com (JD) made record sales during this year’s 6.18 shopping bonanza, which commemorated its founding. JD was founded on June 18, 1998—hence the name "6.18" for the shopping holiday. This year’s 6.18 celebrated 21 years since JD’s founding.

  • JD.com Stock Is Up 35.0% in 2019
    Market Realist4 days ago

    JD.com Stock Is Up 35.0% in 2019

    JD.com (JD) has lost over 6.2% of its value since April 2019. Despite the recent pullback, JD.com stock has gained an impressive 35.0% since the start of 2019. JD.com stock had a disappointing run in 2018 with a 52.0% loss in market value.

  • Is JD Facing a Talent Crisis?
    Market Realist4 days ago

    Is JD Facing a Talent Crisis?

    Is JD.com (JD) struggling to retain its top talent? Two senior JD executives are stepping down this month, and one resigned last month. Those leaving this month include the company’s chief technology officer, Zhang Chen, who will depart on June 30.

  • JD Is Going Offline for China’s Senior Shoppers
    Market Realist4 days ago

    JD Is Going Offline for China’s Senior Shoppers

    At the end of 2018, China was home to 249 million people aged 60 years and older, representing nearly 18% of the country’s population, according to a February report in the China Daily. While China’s ballooning senior population may pose some challenges, JD.com (JD) sees a massive consumer market to cater to.

  • JD Dominates This $120 Billion Retail Category in China
    Market Realist5 days ago

    JD Dominates This $120 Billion Retail Category in China

    Alibaba (BABA) may be known as China’s top e-commerce company, but it doesn’t dominate everywhere. When it comes to selling home appliances online, JD.com (JD) is the king, and Alibaba doesn’t even come in second place.

  • JD Is Open to a Public Listing of Its Logistics Unit
    Market Realist5 days ago

    JD Is Open to a Public Listing of Its Logistics Unit

    JD.com (JD) is open to the public listing of its logistics business but won't say when it might make a move in that direction. JD Logistics operates as a stand-alone business, handling deliveries for JD’s retail operations and also serving outside customers.

  • Should JD.com Stock Holders Be Worried About Employee Exodus?
    InvestorPlace5 days ago

    Should JD.com Stock Holders Be Worried About Employee Exodus?

    It's been almost a year since JD.com (NASDAQ:JD) CEO and founder Richard Liu was arrested on suspicion of rape. Since then, JD stock has lost about 10% of its value. Of course, it could have been much worse. Source: Daniel Cukier via FlickrInvestorPlace - Stock Market News, Stock Advice & Trading TipsLiu was not convicted , and even though the university student who made the allegations is suing JD.com's CEO for undisclosed damages, investors seem to have forgiven the e-commerce company. JD stock is up 35% year-to-date through June 18, recovering most of the losses from the fall and early winter. One thing that has cropped up in recent months that could affect JD.com though is the departure of several key executives. In May, Lan Ye, a key driver of the company's growth, stepped down. In June, chief technology officer Zhang Chen, who was responsible for the company's unmanned logistics operations among other projects, left the company. Also going is general counsel Lu Yong. * 7 Top-Rated Biotech Stocks to Invest In Today Not only are top-level executives leaving, but so, too, are mid-level managers, a sign that Liu's management style might be rubbing employees the wrong way. Should JD stock investors be worried about the exodus? You betcha, but for other reasons. Talent Takes FlightIt's easy to point to JD.com's chief executive as the reason for the culture problem at the company. However, a more significant concern might be that the real reason people are leaving is that JD.com is losing the e-commerce battle to Alibaba (NYSE:BABA), Pinduoduo (NASDAQ:PDD) and all the other smaller e-commerce companies that do battle in China. "Talented workers are starting to quit because they are worried about the outlook for the company," the Nikkei Asian Review reported, quoting an anonymous employee. My InvestorPlace colleague Dana Blankenhorn recently discussed the growth issues facing JD.com. "Serving 60-something moms and dads in rural villages is unique but selling refrigerators to their kids in Shanghai is harder," he wrote on June 19. "Despite having stores as big as 500,000 square feet, that's where I place my worries because then JD.com is competing directly with Alibaba."Dana believes that a profitable JD.com is a stock worth considering given it trades at the same price-to-sales ratio as Walmart (NYSE:WMT), the largest retailer in the world. Profits are always good. In the first quarter ended March 31, JD.com generated $190.7 million in free cash flow, which is 1.1% of revenue in the quarter. By comparison, Alibaba generated $1.6 billion in free cash flow in its latest quarter ended March 31, representing 11.5% of its revenue. JD.com might be profitable in 2019, but it's got a long way to go to meet Alibaba's cash flow generation. There's No ProblemJust before CEO Liu's arrest in late August, I was still on the JD.com bandwagon. I didn't think it was in Amazon's (NASDAQ:AMZN) league, but I believed it had a good business. "I don't think JD shareholders need to worry about the company's business. Overall, it's very strong. Unless it delivers a dud of a quarterly report, the mid $30s appear to be an artificial floor," I wrote August 6. "I wouldn't be surprised if JD stock was trading over $50 by this time next summer."By Labor Day, Liu had been arrested, resulting JD stock down to the high teens by the end of the year. It has since recovered most of those losses. After the Liu revelations, guilty or not guilty, I recommended that investors stay away until the truth came out. Although that's still a matter for the civil courts, the CEO hasn't been charged with a crime. End of, as the Brits say. * Stocks to Buy for $20 or Less Another InvestorPlace colleague, Luke Lango, who owns JD stock, recently suggested that JD.com's Amazon-like growth strategy was back on track. "Revenue growth has stabilized over the past two quarters around 20%, and projects to stay at 20% next quarter too. Meanwhile, operating margins expanded 70 basis points in the fourth quarter of 2018, and 80 basis points in the first quarter of 2019," Luke wrote June 17. "Thus, the Amazon roadmap of sustained big revenue growth on top of margin expansion is once again the underlying trend at JD."If you read between the lines, the fact that employees are leaving JD.com has less to do with its business outlook and more to do with the fact people don't stay with companies nearly as long as they once did. It's time to turn the page. Bottom Line on JD StockWhile I agree with most of my colleague's sentiments about JD.com, I have less conviction that JD stock is going to run much higher in 2019. Perhaps it gets to the mid-$30s with another good earnings report. Beyond that, I'm doubtful. As for employees leaving, I wouldn't give it a second thought. Good people leave companies all the time. JD.com's no different. At the time of this writing Will Ashworth did not hold a position in any of the aforementioned securities. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Value Stocks to Buy for the Second Half * 7 Hot Stocks to Buy for a Seemingly Sleepy Summer * 6 Chip Stocks Staring At Big Headwinds in 2019 Compare Brokers The post Should JD.com Stock Holders Be Worried About Employee Exodus? appeared first on InvestorPlace.

  • Chinese Indexes Gain, Fed Loses ‘Patience’
    Market Realist5 days ago

    Chinese Indexes Gain, Fed Loses ‘Patience’

    China’s benchmark Shanghai Composite Index is having a good week. The index rose 2.4% on June 20 to an eight-week high. The index rose in the first half of the day and reached the day’s high.

  • The Trade War Is the Only Thing Holding Back JD Stock
    InvestorPlace5 days ago

    The Trade War Is the Only Thing Holding Back JD Stock

    As the potential of JD.com (NASDAQ:JD) draws interest, the company remains mired in a trade war hitting most Chinese stocks as well as a few self-inflicted problems. While this may hamper JD stock for now, the company should grow long-term as JD extends its reach both into established markets and, in some cases, markets ignored by the investment community.Source: Daniel Cukier via Flickr JD Stock and the Trade WarWithout question, the 800-pound gorilla driving JD.com remains the U.S.-China trade war.JD continues its alliance with Walmart (NYSE:WMT). Nonetheless, the trade war affects mostly its customers, who have less money to spend with more limited access to the U.S. This brought the stock price from $50 per share down to $20 last year. A recovery has taken it above $28 per share. Still, JD trades more than 40% below its all-time high.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 6 Stocks Ready to Bounce on a Trade Deal Another factor involves the legal troubles of company founder and CEO Richard Liu. We now know he will not go to jail, but civil allegations related to the rape accusation remain an issue.Such personal matters should concern investors. The company has no clear successor or even a plan of succession. Given the scope of Liu's troubles, a succession plan would remove a source of uncertainty that weighed on JD stock last fall.His management decisions have also led to criticism. The so-called "996" schedule, 9:00 am to 9:00 pm, six days per week has attracted a lot of negative publicity. Mr. Liu also faces attacks for criticizing employees perceived as lazy or unwilling to sacrifice for the company.Still, barring a major strike, labor complaints rarely affect stocks. Also, I think management will find a way to fill the vacuum should something happen to Mr. Liu. After the trade war ends, traders will more than likely judge JD for what the company does right and how that benefits investors. Investment and JD StockWhat has benefitted investors is the investment in infrastructure. While many believe the logistics network itself will trade under a separate stock, JD's management has no plans to list this unit separately on the markets.However, logistics remains the factor that separates it from its larger rival, Alibaba (NYSE:BABA). Rather than acting as a middleman like Alibaba, JD built a logistics network comparable to that of Amazon (NASDAQ:AMZN) in the United States.This gives JD an advantage as it facilitates omnichannel retailing. With a forecasted 94.3% earnings increase this year and 50% the next, these investments have begun to pay off. Moreover, traders can buy this kind of earnings growth at a relatively low price. Currently, the stock trades at a forward price-to-earnings (PE) ratio of about 27.2.Admittedly, such a multiple would appear expensive to most stocks. Also, should profits on JD stock take a sudden dive, the company might struggle to maintain this multiple. However, considering the earnings growth, 27.2 times forward earnings looks like a bargain.Further, as I mentioned in a previous article, investors should not discount its investment in Indonesia. At a population now estimated at over 269 million, it has more people than two more recognized emerging markets, Brazil and Russia. Hence, as it gains more attention as an emerging market, the rise of Indonesia should help JD stock to rise as well.Yes, the company needs the trade war to end, and the company should address its succession issues. However, given the deep investments and its reach across the world, I see little else that can stand in the way. Concluding thoughts on JD stockJD's deep infrastructure investments at home and its reach abroad should help JD.com stock overcome its challenges long term. Admittedly the trade war and Mr. Liu's legal troubles have influenced the stock's short-term performance. Some of his management decisions have also brought criticism.However, when one can buy 50%-plus profit growth for 27 times forward earnings, it should pay off at some point. This makes JD stock a winner--as soon as it can put the trade war behind it.As of this writing, Will Healy did not hold a position in any of the aforementioned stocks. You can follow Will on Twitter at @HealyWriting. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Blue-Chip Stocks to Buy for a Noisy Market * 5 Strong Buy Biotech Stocks for the Second Half * 6 Stocks Ready to Bounce on a Trade Deal Compare Brokers The post The Trade War Is the Only Thing Holding Back JD Stock appeared first on InvestorPlace.

  • These 3 Chinese Stocks Will Soar on a Trade Truce
    Motley Fool6 days ago

    These 3 Chinese Stocks Will Soar on a Trade Truce

    Baidu, JD, and Huya are all coiled springs that could pop on any good news about China.

  • 4 Burning Questions for the Owners of Alibaba Stock
    InvestorPlace6 days ago

    4 Burning Questions for the Owners of Alibaba Stock

    In May, Alibaba (NYSE:BABA) reported what appeared to be blowout earnings. The report topped expectations by a mile, but it did nothing for Alibaba stock. BABA stock price barely advanced following the earnings release, and it is still down 9% over the last three months.Source: Shutterstock What's going on? Surely, some of the struggles of Alibaba stock are related to the trade war. The longer it drags on, the more the Chinese economy will continue to slump. But Alibaba faces some unique issues of its own, namely that people are increasingly questioning the company's accounting. BABA is now trying to sell more stock to the public, while its short interest has ballooned to 9% of its available shares. That's a massive number for a company of its size. * 7 Value Stocks to Buy for the Second Half The shorts have been encouraged by the internet posts of a person who claims to be a financial professional These posts, made under the name Deep Throat IPO, contain allegations about Alibaba's accounting, leading many investors to conclude that BABA can't be trusted.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Is Alibaba Actually Earning Much Money?For last quarter, Alibaba reported a huge jump in its net income. In fact, on both a GAAP and non-GAAP basis, Alibaba crushed analysts' average expectation. It reported non-GAAP earnings per share for the quarter of $1.28 against the consensus outlook of just 95 cents. Meanwhile, its GAAP EPS of $1.47 absolutely annihilated analyst estimates of just 51 cents per share.What explains the huge disparity? Most of Alibaba's reported profits for the quarter came from marking up the value of its investments rather than from its operating businesses. For the quarter, its reported net income soared 252% year-over-year to $3.5 billion. However, its actual profits from its operating business went down 5% to just $1.3 billion, though it would have posted a modest gain if it hadn't had to pay a lawsuit settlement.Still, its worth asking what's going on. Alibaba reports phenomenal revenue growth rates, yet its core retail profits are essentially flat. And its much-touted cloud and digital media divisions continue to lose money. Take out the increased profits from its investments - which doesn't mean much unless BABA can turn that paper into actual cash in the future - and BABA stock is absurdly expensive compared to its actual cash earnings. Is Alibaba Really Bigger Than Wal-Mart And Amazon?There's long been a great deal of dispute over whether Alibaba and other Chinese retailers inflate their GMVs (Gross Merchandise Volume). The SEC probed Alibaba's sales reporting a few years ago, and investors have made allegations about other Chinese firms like PinDuoDuo (NASDAQ:PDD) inflating their revenue.In the case of Alibaba, the numbers get more and more questionable as time goes on. Alibaba claims its GMV has soared more than tenfold from 2012 to today, with that figure jumping from $80 billion then to more than $800 billion now. For comparison sake, that's more than Walmart (NYSE:WMT) and Amazon (NASDAQ:AMZN) handle annually combined! You might say that Alibaba's business could be that big because China is so huge. Remember, though, that Walmart is a leading retailer in 25 countries and Amazon has a huge overseas businesses as well. It strains credibility to believe that Alibaba is larger than Walmart and Amazon put together.There's also the matter of how much each company generates per employee. That is a common check for fraud, and Alibaba comes out looking rather peculiar. Deep Throat IPO puts it well:The other ratio I find fascinating is GMV per employee. Walmart's GMV per employee is $284,000. Amazon's is $428,000. Alibaba's is $8,366,000 per employee. They are truly masters at doing more with less.Is it realistic for Alibaba's employees to be 20 times more efficient than Amazon's? If you own BABA stock, you better hope so. Is Ant Financial Worth Anything Close To Investors' Expectations?Supposedly, Alibaba's Ant Financial, a digital payments facilitator, is worth $150 billion, which would make up around a third of the overall $400 billion market cap of Alibaba stock. In fact, Ant Financial was valued at $150 billion when it raised money last year. However, there is reason to be skeptical about that valuation. Specifically, it scrapped plans for an IPO last year, and it was supposed to launch an IPO this year, but the offering appears to be delayed again.Meanwhile, Ant Financial, which is supposed to be such a dominant global payments player, doesn't appear to be doing so well. Last year, Alibaba, which has a profit-sharing agreement with Ant Financial, did not receive any distributions from Ant because Ant didn't make any profits. This past quarter, however, Alibaba earned $77 million from Ant Financial. $77 million seems like a pittance, given Ant Financial's supposed $150 billion valuation. Perfectly normal. What Happens If the Chinese Financial System Freezes Up?For all of Alibaba's purported profits, the company keeps needing more money. There's probably good reason for that, since most of its "profits" don;t come in the form of cash while it is investing money in a nearly endless list of start-ups both in China and overseas. As mentioned above, Ant Financial did a big fundraising push last year, and now Alibaba is trying to unload a cool $20 billion of its stock in a secondary offering in Hong Kong.All this brings up the trade war and the weakening yuan. The yuan is near seven per dollar, its lowest level in years, and pressure appears to be growing for a major devaluation of the currency. What happens to Alibaba's ability to raise more money to keep its investing carousel spinning if China's capital markets freeze up? Also, the valuations of all these nascent businesses Alibaba has invested in will implode if the IPO window shuts down for these sorts of firms. The Verdict on BABA StockIt's been interesting watching Alibaba and JD.com (NASDAQ:JD) over the past year or two. As the Chinese economy has slowed, many of China's retailers have seen their growth rates sharply drop. JD, for example, has gone from 50% annual growth to just 20% recently. Alibaba's growth rate, however, appears totally unaffected by the deepening Chinese malaise. It keeps pumping out 50% annual revenue growth, rain or shine. Does Alibaba have a special sauce that keeps it immune to economic weakness?So far, BABA stock has been a winner. But how long can it keep up? Alibaba already claims to be larger than Amazon and Walmart put together. If the numbers are real, surely BABA will run out of people to sell to fairly soon; there are, after all, limits to a company's growth once it dominates a market. And if the numbers aren't real…At the time of this writing, Ian Bezek owned JD.com stock. You can reach him on Twitter at @irbezek. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Value Stocks to Buy for the Second Half * 7 Hot Stocks to Buy for a Seemingly Sleepy Summer * 6 Chip Stocks Staring At Big Headwinds in 2019 Compare Brokers The post 4 Burning Questions for the Owners of Alibaba Stock appeared first on InvestorPlace.

  • With BABA Stock Price Down, Why Is Alibaba Selling Shares In Hong Kong?
    InvestorPlace6 days ago

    With BABA Stock Price Down, Why Is Alibaba Selling Shares In Hong Kong?

    Alibaba (NYSE:BABA) reportedly is getting a Hong Kong listing. Multiple reports suggest the company is planning to sell $20 billion worth of Alibaba stock on the Hong Kong Stock Exchange. A key question, with the BABA stock price down about 18% from early May highs, is "Why now?".Source: Shutterstock As with so much when it comes to Alibaba stock, bulls and bears likely will answer the question very differently. Bulls see the company raising capital for its myriad initiatives -- and potentially raising the profile of BABA stock. Bears wonder why the company needs the cash and why it needs to do such a deal now.BABA has long been a battleground stock. The Hong Kong listing likely will only harden both sides.InvestorPlace - Stock Market News, Stock Advice & Trading Tips The Case for the Alibaba Stock OfferingThere are two broad benefits to the cross-listing. One, Alibaba's plan to list on the Hong Kong exchange could -- and maybe should -- drive the BABA stock price higher.Hong Kong-listed shares can be owned directly by Chinese investors. Those investors might see Alibaba more favorably than their foreign counterparts. And if Alibaba stock rises on the Hong Kong exchange, its New York listing might do the same, as arbitrageurs buy cheaper New York-listed shares. * 7 Top-Rated Biotech Stocks to Invest In Today That said, those arbitrageurs also would sell the Hong Kong-listed shares, potentially mitigating some of the effects of increased demand. And the two shares would not be the same: BABA stock does not offer direct ownership of the company. Rather, 'shareholders' own a stake in a VIE (variable interest entity) in the Cayman Islands.That VIE has a contractual right to Alibaba profits -- but that's not the same thing as actually owning shares of Alibaba itself. As such, it would seem almost certain that Alibaba shares in New York will trade at a consistent, if modest, discount to the Hong Kong-listed shares to account for the VIE-related risk.Still, details aside, a second listing could increase demand for Alibaba stock, particularly among China's retail investors. Smaller investors control 35% of the Chinese market, against an 8% share in the U.S. And the pending Alibaba stock split likely allows those Chinese retail investors to afford smaller positions. There is a case that BABA stock should get a bump from the two listings.The second goal, apparently, is to raise capital. Alibaba's New York IPO was the largest in history, raising $25 billion. Alibaba reportedly will bring in another $20 billion this time around. Those funds can be used for more acquisitions; building out the cloud business; or further investing behind the business.That in turn would seem to signal a longer-term rise in Alibaba stock, assuming the funds are invested well. The Case Against the OfferingSo BABA bulls no doubt see the new listing as good news. Indeed, the BABA stock price has risen modestly of late, though a stronger broad market likely plays a role as well.But for Alibaba skeptics, the offering seems curious. That's particularly true for investors who question the company's accounting, The first question is why, exactly, Alibaba needs another $20 billion. The company closed fiscal 2019 (ending March 31) with $28.3 billion in cash on its balance sheet. Alibaba owns another $24 billion or so in investment securities (not including its investments in private companies). That $44 billion war chest sits against total debt of less than $9 billion.To be sure, Alibaba does have places to spend its cash. The company's operations beyond core commerce last year -- cloud computing, digital media and entertainment, and its "innovation initiatives" -- all posted losses last year as Alibaba invested in future growth. In cloud, Alibaba is trying to replicate the success of Amazon (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT). Rival JD.com (NASDAQ:JD) is spending heavily on its supply chain.But operating losses for those segments totaled a little over $5 billion. Even with those losses, free cash flow was somewhere in the range of $15 billion, even including payments for copyrights and other intangible assets. * 10 Stocks to Buy That Wall Street Expects to Soar for the Rest of 2019 For those who doubt Alibaba, the offering (which reportedly will be of new shares) makes little sense. Alibaba, if its financials are accurate, has more than enough cash to fund even aggressive investments in its new initiatives. Unless there's a big acquisition planned, Alibaba is diluting its shareholders for money it doesn't seem to need. Is the BABA Stock Price Too Low?Alibaba stock is down 23% from July 2018 highs. Yet it will likely price those shares at a discount to the current U.S.-listed price (as is usually the case with these offerings). That in turn means Alibaba shareholders will see their ownership diluted at a price well below their view of the stock's intrinsic value. (Presumably, all Alibaba shareholders, outside of passive managers, believe the stock is undervalued at the moment.)It's possible the dilution will be worth it. Perhaps Alibaba has a big deal in mind. It needs to compete against JD.com and Tencent Holdings (OTCMKTS:TCEHY) and, perhaps, the more cash the better. A wider reach for the stock -- and direct ownership, as opposed to the U.S.-based VIE structure -- can help as well.But the capital raise only adds to the doubts surrounding BABA stock as well. And while short interest here is likely somewhat overstated (there are no doubt arbitrage traders who are long Altaba (NASDAQ:AABA) and short BABA), short sellers likely will see the offering as confirming their thesis, not disproving it.In short, the beauty of the listing, like Alibaba stock, is in the eye of the beholder. Bulls see more shareholders, more cash, and a higher BABA stock price. Bears see another questionable move … and maybe even another red flag. Time will tell which side has it right.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 5 Red-Hot IPO Stocks to Buy for the Long Run * 5 Stocks to Buy for $20 or Less * 4 Dow Jones Stocks Ready to Rise Compare Brokers The post With BABA Stock Price Down, Why Is Alibaba Selling Shares In Hong Kong? appeared first on InvestorPlace.