|Bid||249.66 x 1000|
|Ask||249.76 x 1300|
|Day's range||248.76 - 250.32|
|52-week range||169.95 - 319.32|
|Beta (5Y monthly)||0.90|
|PE ratio (TTM)||26.79|
|Forward dividend & yield||N/A (N/A)|
|1y target est||N/A|
(Bloomberg) -- Alibaba Group Holding Ltd, once the most valuable company in China, is turning from a global hedge fund favorite to something less than desirable.Investors from hedge fund titans such as Point72 Asset Management and Moore Capital Management to Canadian and U.S. pension funds dumped 101 million of Alibaba’s American depositary receipts in the fourth quarter, cutting the market value of their holdings by $89 billion, according to filing data. It was the biggest investment reduction among U.S. traded companies, more than three times the second-most sold stock, Salesforce.com Inc..Once a symbol of China’s New Economy, the e-commerce giant founded by Jack Ma now finds itself at the forefront of the government’s campaign to rein in the sprawling power of tech giants. Alibaba’s shares, which are traded on the New York Stock Exchange, have slumped about 18% since November, when regulators in Beijing halted the $35 billion initial public offering of Alibaba’s affiliate Ant Group at the last minute. Government watchdogs have also ordered Ant to overhaul its business and began an antitrust investigation of Alibaba.Meanwhile, Alibaba, which has invested in a wide range of sectors from online grocery to ride-hailing and artificial intelligence, will face restraints on future expansion. Chinese antitrust watchdogs used to pay little attention to investment led by internet companies, but have begun strengthening enforcement amid Beijing’s push to root out monopoly power. In December, China’s antitrust watchdog fined Alibaba and two other companies over years-old acquisitions. Regulators said the e-commerce heavyweight should have sought government approval before increasing its stake in a department store chain in 2017.If someone were to make an example of how to take down a monopoly in China, they’ve got nothing better than Alibaba, said Rajiv Jain, who oversees $73 billion in assets as chairman of GQG Partners LLC in Fort Lauderdale, Florida. “The long-term growth trajectory is now different from what we thought.”GQG liquidated all of its 9.6 million ADRs in the fourth quarter, valued at $2.8 billion, according to filing data. Jain said he had owned Alibaba shares since the company’s initial public offering in 2014, when he was the chief investment officer at Vontobel Asset Management.An Alibaba spokesperson declined to comment on investors selling the stock.Investors are questioning whether Alibaba can sustain its meteoritic rise amid the regulatory scrutiny. It now could face penalties of as much as 10% of its revenue if it’s found to have violated antitrust rules. Those rules are against practices such as forced exclusive arrangements with merchants, known as “Pick One of Two,” predatory pricing and algorithms favoring new users. Tightening government oversight also threatens to curb Ant’s dominance in online payments and scale back its expansion into consumer lending and wealth management.Alibaba has said that it’s working with regulators on complying with their requirements as the antitrust investigations continue. Share prices have recovered somewhat since Ma resurfaced in late January after vanishing from the public sight following the government’s crackdown on his businesses. The shares fell about 1% to $250.34 in New York Wednesday. Alibaba sellers are Who’s Who of hedge fund stars. Steve Cohen’s Point72 dumped all its $413 million in holdings last quarter fourth quarter. Louis Bacon’s Moore Capital slashed its holdings by 99%, while Dan Loeb’s Third Point cut its stake by 45%.Other prominent investors cashing out include Hillhouse Capital Advisors, which sold its $1.2 billion holdings. Canada Pension Plan Investment Board reduced its stake by 31%, or $2.1 billion.Izzy Englander’s Millennium Management LLC was among a minority group of investors who scooped up Alibaba, counting it as its sixth-largest holdings.Representatives at these firms either declined to comment or didn’t reply to emails or calls.Rather than pulling out, some investors may have swapped their ADRs with shares traded in Hong Kong to avoid the risk of being caught in the political tension between the U.S. and China, said Brendan Ahern, chief investment officer at Krane Funds Advisors LLC, which runs several China-focused exchange-traded funds in the U.S.Former U.S. President Donald Trump signed legislation in December that could kick Chinese companies off of U.S. exchanges unless American regulators can review their financial audits. The administration had also considered banning U.S. investments in Chinese companies, including Alibaba and Tencent, before deciding against it.“Alibaba is a very well-managed company,” said Ahern. “We are a big believer in the company and management.”Analysts share Ahern’s upbeat sentiment. All but three of 61 analysts rate the company as a buy.For GQG’s Jain, the regulatory uncertainties mean the risk-reward calculation is stacking against Alibaba. For instance, it’s becoming much more difficult for the company to grow its business by acquiring smaller players.“There’s more downside than upside,” said Jain, whose Goldman Sachs GQG Partners International Opportunities Fund beat 83% of its peers over the past three years. “The regulatory risk is usually underappreciated until it’s too late. In other words, you cannot handicap that.”(Update with Ailbaba’s share price in ninth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Tencent Holdings Ltd.-backed Yuanfudao is seeking fresh funding at a valuation of more than $20 billion, people familiar with the matter said, as the cash-burning battle in China’s online education arena shows no sign of abating.The Beijing-based tutoring app is planning to raise at least $1 billion and has held discussions with investors including Boyu Capital and DCP Capital, according to people familiar with the matter. The funding round has yet to be finalized and the size will depend on investor interest, the people said, asking not to be identified as the information isn’t public.The latest fundraising comes less than six months after a $2.2 billion round that valued the startup at $15.5 billion, the most among edtech companies globally, Yuanfudao said at the time. The tutoring upstart is competing with top teaching providers like TAL Education Group as well as the education wings of internet giants like ByteDance Ltd. for a bigger share of China’s private education industry.Yuanfudao -- backed by investors like Hillhouse Capital and IDG -- is seeking to boost its valuation ahead of a possible stock market debut in 2022, said the people. Yuanfudao said in a statement that it doesn’t have any formal fundraising plans. Boyu and DCP declined to comment.China’s edtech firms are replenishing their war chests after splashing out hundreds of millions to grow their operations during 2020’s pandemic lockdowns. The country’s online education startups attracted a total of $9.2 billion last year, more than quadruple the funds raised in 2019, according to research firm Zero2IPO Group. In January, close rival Zuoyebang raised $1.6 billion from investors including Alibaba Group Holding Ltd. and SoftBank Vision Fund.The unfettered expansion has drawn the ire of Beijing, which has signaled its intention to rein in the mounting influence of tech companies in the world’s No. 2 economy. The country’s education ministry has hit out at questionable behaviors from the companies, ranging from excessive advertising to the use of unapproved teaching materials, the official paper of the Communist Party’s disciplinary watchdog wrote last month. Yuanfudao, for its part, has sponsored popular web series as well as China’s annual Spring Festival TV gala this year.Founded in 2012, Yuanfudao offers a variety of online education products from live-streaming courses to test prepping, with more than 400 million users across China. The firm has also set up offline teaching facilities, with more than 30,000 employees.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Online luxury platform Farfetch (NYSE: FTCH) is expected to see the number of active shoppers on its site soar to at least 30 million in the next five years as its partnership with Alibaba (NYSE: BABA) and Richemont (OTC: CFRUY) brings in incremental new demand from Chinese consumers. Last November, Alibaba and Richemont committed to investing over $1.1 billion in the luxury goods marketplace with the three companies forming a joint venture called Farfetch China. In a research note to investors, Credit Suisse (NYSE: CS) analyst Stephen Ju wrote that Farfetch is likely to turn in strong fourth-quarter earnings numbers when it reports on Thursday.