4/30 Daily Market Note: DCF Conclusion Study on Alibaba (BABA)
Is there still a chance for 100/share on BABA?
Hi Everyone -
The market is experiencing jitters before tomorrow’s FOMC session as investors fear an unusually Hawkish Fed given the stubborn inflation-related data that has been recently released.
Once again, if you are a long-term investor, this type of market action is absolutely no cause for concern. The S&P 500 had risen nearly 10% in 2024 before seeing a softer month in April. Such a large upside move was prone to some mean-reversion, whether the Fed re-emerged hawkish or not.
In terms of areas of value in the market on intermediate-term timelines upon pullbacks, I continue to think that selloffs in China are likely to be bought up. China still trades at a valuation discount compared to peers Japan and India, and policy makers are actively shaping the macro context to be more constructive for both consumers and foreign investors.
I recently did a podcast interview with Cabot Wealth Network on an update for the China investment landscape after my last call with them in November 2023 where I had shared PDD, TCOM, and EDU as top ideas from our Community. 6 months later PDD has advanced 18%, TCOM 45%, and EDU 40%+.
Below is a brief clip and the link here is the full interview if you want to watch.
Let’s now get into our BABA DCF!