Alibaba Group Holding Ltd
Oppenheimer analyst Jason Helfstein weighs in on Alibaba Group Holding Ltd (NYSE:BABA), after the Chinese e-commerce giant announced a series of transactions to sell $8.9 billion worth of BABA shares at $74 per share.
Helfstein wrote, “The transaction is aimed at reducing Softbank’s debt to EBITDA from 3.8x to 3.3x as of 3/31, while not putting material float into the market. In addition, Softbank has the option of converting the note to BABA stock or cash in 2019. This has positive tax benefits to Softbank and gives the company maximum flexibility with its BABA stake. Softbank also agreed to a normal 6-month lockup. While this is causing short-term weakness in BABA shares as it provides an alternative investment vehicle in BABA, we see the upcoming analyst event as major positive catalyst toward a sum-of-the-parts valuation.”
Helfstein reiterated an Outperform rating on shares of Alibaba, with a price target of $100, which represents a potential upside of 30% from where the stock is currently trading.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Jason Helfstein has a yearly average return of 7% and a 54% success rate. Helfstein has a 3.9% average return when recommending BABA, and is ranked #281 out of 3986 analysts.
Cantor analyst Youssef Squali reiterated a Buy rating on shares of Amazon as he believes that the online retail giant is “winning the mobile war”.
Squali noted, “As audiences spend a growing portion of their time on mobile, major retailers are attempting to quickly adapt to this shift in usage. Our analysis of mobile data for leading ecommerce and traditional players shows how Amazon not only leads the group in mobile adoption and usage, but that the gulf between the time spent with the company and virtually all other platforms is expanding rapidly, implying further market share gains ahead.”
According to TipRanks.com, analyst Youssef Squali has a yearly average return of 14.3% and a 66% success rate. Squali has a 33.9% average return when recommending AMZN, and is ranked #11 out of 3986 analysts.
Out of the 30 analysts polled by TipRanks, 28 rate Alibaba Group stock a Buy, while 2 rate the stock a Hold. With a return potential of 26.3%, the stock’s consensus target price stands at $97.28.