Alibaba Group Valuation

BABA Stock  USD 72.36  0.77  1.08%   
At this time, the firm appears to be fairly valued. Alibaba Group Holding shows a prevailing Real Value of $72.75 per share. The current price of the firm is $72.36. Our model approximates the value of Alibaba Group Holding from analyzing the firm fundamentals such as Profit Margin of 0.11 %, current valuation of 113.76 B, and Return On Equity of 0.0821 as well as examining its technical indicators and probability of bankruptcy. In general, most investors favor taking in undervalued instruments and trading overvalued instruments since, at some point, asset prices and their ongoing real values will blend.
Price Book
1.277
Enterprise Value
113.8 B
Enterprise Value Ebitda
0.8107
Price Sales
0.1953
Forward PE
7.8493
Fairly Valued
Today
72.36
Please note that Alibaba Group's price fluctuation is very steady at this time. Calculation of the real value of Alibaba Group Holding is based on 3 months time horizon. Increasing Alibaba Group's time horizon generally increases the accuracy of value calculation and significantly improves the predictive power of the methodology used.
Our valuation method for Alibaba Group Holding is useful when determining the fair value of the Alibaba stock, which is usually determined by what a typical buyer is willing to pay for full or partial control of Alibaba Group. Since Alibaba Group is currently traded on the exchange, buyers and sellers on that exchange determine the market value of Alibaba Stock. However, Alibaba Group's intrinsic value may or may not be the same as its current market price, in which case there is an opportunity to profit from the mispricing, assuming the market price will eventually merge with its intrinsic value.
Historical Market  72.36 Real  72.75 Target  139.24 Hype  72.36 Naive  70.45
The real value of Alibaba Stock, also known as its intrinsic value, is the underlying worth of Alibaba Group Holding Company, which is reflected in its stock price. It is based on Alibaba Group's financial performance, assets, liabilities, growth prospects, management team, or industry conditions. The intrinsic value of Alibaba Group's stock can be calculated using various methods such as discounted cash flow analysis, price-to-earnings ratio, or price-to-book ratio. That value may differ from its current market price, which is determined by supply and demand factors such as investor sentiment, market trends, news, and other external factors that may influence Alibaba Group's stock price. It is important to note that the real value of any stock may change over time based on changes in the company's performance.
72.75
Real Value
75.02
Upside
Estimating the potential upside or downside of Alibaba Group Holding helps investors to forecast how Alibaba stock's addition to their portfolios will impact the overall performance. We also use other valuation drivers to help us estimate the true value of Alibaba Group more accurately as focusing exclusively on Alibaba Group's fundamentals will not take into account other important factors:
Earnings
Estimates (0)
LowProjectedHigh
2.001.532.35
Details
Hype
Prediction
LowEstimatedHigh
70.0972.3674.63
Details
Potential
Annual Dividend
LowForecastedHigh
0.330.330.34
Details
45 Analysts
Consensus
LowTarget PriceHigh
126.71139.24154.56
Details

Alibaba Group Investments

(128.05 Billion)

Alibaba Group Valuation Ratios as Compared to Competition

Comparative valuation techniques use various fundamental indicators to help in determining Alibaba Group's current stock value. Our valuation model uses many indicators to compare Alibaba Group value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Alibaba Group competition to find correlations between indicators driving Alibaba Group's intrinsic value. More Info.
Alibaba Group Holding is number one stock in price to earning category among related companies. It is rated fifth in annual yield category among related companies . The ratio of Price To Earning to Annual Yield for Alibaba Group Holding is about  8,034 . Comparative valuation analysis is a catch-all model that can be used if you cannot value Alibaba Group by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Alibaba Group's Stock . Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Alibaba Group's earnings, one of the primary drivers of an investment's value.
Please note that valuation analysis is one of the essential comprehensive assessments in business. It evaluates Alibaba Group's worth, which you can determine by considering its current assets, liabilities and future cash flows. The investors' valuation analysis is an important metric that will give you a perspective on different companies. It helps you know the worth of the potential investment in Alibaba Group and how it compares across the competition.

About Alibaba Group Valuation

The stock valuation mechanism determines the current worth of Alibaba Group Holding on a weekly basis. We use both absolute as well as relative valuation methodologies to arrive at the intrinsic value of Alibaba Group Holding. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Alibaba Group Holding based exclusively on its fundamental and basic technical indicators. By analyzing Alibaba Group's financials, quarterly and monthly indicators, and its related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of Alibaba Group's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Alibaba Group. We calculate exposure to Alibaba Group's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to Alibaba Group's related companies.
Last ReportedProjected for 2024
Gross Profit366.8 B385.2 B
Pretax Profit Margin 0.31  0.39 
Operating Profit Margin 0.28  0.31 
Net Profit Margin 0.26  0.32 
Gross Profit Margin 0.83  0.72 

8 Steps to conduct Alibaba Group's Valuation Analysis

Company's valuation is the process of determining the worth of any company in monetary terms. It estimates Alibaba Group's potential worth based on factors such as financial performance, market conditions, growth prospects, and overall economic environment. The result of company valuation is a single number representing a Company's current market value. This value can be used as a benchmark for various financial transactions such as mergers and acquisitions, initial public offerings (IPOs), or private equity investments. To conduct Alibaba Group's valuation analysis, follow these 8 steps:
  • Gather financial information: Obtain Alibaba Group's financial statements, including balance sheets, income statements, and cash flow statements.
  • Determine Alibaba Group's revenue streams: Identify Alibaba Group's primary sources of revenue, including products or services offered, target markets, and pricing strategies.
  • Analyze market data: Research Alibaba Group's industry and market trends, including the size of the market, growth rate, and competition.
  • Establish Alibaba Group's growth potential: Evaluate Alibaba Group's management, business model, and growth potential.
  • Determine Alibaba Group's financial performance: Analyze its financial statements to assess its historical performance and future potential.
  • Choose a valuation method: Consider the Company's specific circumstances and choose an appropriate valuation method, such as the discounted cash flow (DCF) or comparable analysis method.
  • Calculate the value: Apply the chosen valuation method to the financial information and market data to calculate Alibaba Group's estimated value.
  • Review and adjust: Review the results and make necessary adjustments, considering any relevant factors that may have been missed or overlooked.
Note: This is a general outline, and different approaches and methods may be used depending on the type and size of the company being valued. We also recomment to seek professional assistance to ensure accuracy.
Alibaba Group's stock price is the clearest measure of market expectations about its performance. Without stock valuation, investors cannot independently discern whether Alibaba Group's value is low or high relative to the company's performance and growth projections. Determining the market value of Alibaba Group can be done in different ways, such as multiplying its stock price by its outstanding shares.
A single share of Alibaba Group represents a small ownership stake in the entity. As a stockholder of Alibaba, your percentage of company ownership is determined by dividing the number of shares you own by the total number of shares outstanding and then multiplying that amount by 100. Owning stock in a company generally confers both corporate voting rights and income from any dividends paid to the stock owner.

Alibaba Group Dividends Analysis For Valuation

Please note that Alibaba Group has scaled down on payment of dividends at this time. At present, Alibaba Group's Retained Earnings are projected to increase significantly based on the last few years of reporting. The current year's Price Earnings To Growth Ratio is expected to grow to 49.69, whereas Price Earnings Ratio is forecasted to decline to 1,268.
There are various types of dividends Alibaba Group can pay to its shareholders, and the actual value of the dividend is determined on a per-share basis. It is to be paid equally to all of Alibaba shareholders on a specific date, known as the payable date. The cash dividend is the most common type of dividend payment - it is the payment of actual cash from Alibaba Group Holding directly to its shareholders. There are other types of dividends that companies can issue, such as stock dividends or asset dividends. When Alibaba pays a dividend, it has no impact on its enterprise value. It does, however, lowers the Equity Value of Alibaba Group by the value of the dividends paid out.

Alibaba Group Growth Indicators

Growth stocks usually refer to those companies expected to grow sales and earnings faster than the market average. Growth stocks typically don't pay dividends, often look expensive, and usually trading at a high P/E ratio. Nevertheless, such valuations could be relatively cheap if the company continues to grow, which will drive the share price up. However, since most investors are paying a high price for a growth stock, based on expectations, if those expectations are not fully realized, growth stocks can see dramatic declines. Note, investing in growth stocks can be very risky. If the company such as Alibaba Group does not do well, investors take a loss on the stock when it is time to sell. Also, because growth stocks typically do not pay dividends, the only opportunity an investor has to make money on their investment is when they eventually sell their shares.
Common Stock Shares Outstanding2.6 B
Quarterly Earnings Growth Y O Y-0.684
Forward Price Earnings7.8493

Alibaba Group Current Valuation Indicators

Valuation refers to the process of determining the present value of Alibaba Group Holding and all of its assets. It can be calculated using a number of techniques. As many analysts who try to value Alibaba we look at many different elements of the entity such as Alibaba's management, its prospective future earnings, the current market value of the company's assets, as well as its capital structure formation. Alibaba Group's valuation analysis is also a process of estimating the intrinsic value of all assets and outstanding equities. There are different methodologies and models we use to develop the final Alibaba Group's valuation. The techniques such as discounted cash flow and fundamental indicators such as book value per share or market capitalization are well known and widely used across most financial advisers and money managers.
Valuations are an essential part of business, for companies themselves, but also for investors. For companies, such as Alibaba Group, valuations can help measure their progress and success and can help them track their performance in the market compared to others. In addition, investors can use Alibaba Group's valuations to help determine the worth of potential investments. They can do this by using data and information made public by a company. Regardless of who the valuation is for, it essentially describes Alibaba Group's worth.
When determining whether Alibaba Group Holding offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Alibaba Group's financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Alibaba Group Holding Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Alibaba Group Holding Stock:
Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in Alibaba Group Holding. Also, note that the market value of any company could be tightly coupled with the direction of predictive economic indicators such as signals in bureau of labor statistics.
Note that the Alibaba Group Holding information on this page should be used as a complementary analysis to other Alibaba Group's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.

Complementary Tools for Alibaba Stock analysis

When running Alibaba Group's price analysis, check to measure Alibaba Group's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Alibaba Group is operating at the current time. Most of Alibaba Group's value examination focuses on studying past and present price action to predict the probability of Alibaba Group's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Alibaba Group's price. Additionally, you may evaluate how the addition of Alibaba Group to your portfolios can decrease your overall portfolio volatility.
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Is Alibaba Group's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Alibaba Group. If investors know Alibaba will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Alibaba Group listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
(0.68)
Dividend Share
6.869
Earnings Share
5.37
Revenue Per Share
363.638
Quarterly Revenue Growth
0.051
The market value of Alibaba Group Holding is measured differently than its book value, which is the value of Alibaba that is recorded on the company's balance sheet. Investors also form their own opinion of Alibaba Group's value that differs from its market value or its book value, called intrinsic value, which is Alibaba Group's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Alibaba Group's market value can be influenced by many factors that don't directly affect Alibaba Group's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Alibaba Group's value and its price as these two are different measures arrived at by different means. Investors typically determine if Alibaba Group is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Alibaba Group's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.