Followers | 689 |
Posts | 143817 |
Boards Moderated | 35 |
Alias Born | 03/10/2004 |
Friday, August 31, 2018 10:55:02 AM
By: Bloomberg | August 31, 2018
Tencent and Alibaba have started underperforming the likes of Apple and Amazon, and the gap may be here to stay.
Not all tech stars are equal. While U.S. giants from Apple Inc. to Amazon.com Inc. march to or through the $1 trillion valuation mark, China’s darlings are getting dumped.
The groups started to diverge two months ago, and the big American tech stocks have outperformed their Chinese counterparts by 19 percentage points since then. With more than $18 billion of bets now standing against Alibaba Group Holding Ltd., the e-commerce leader is the world’s most shorted stock. Tencent Holdings Ltd. shares dropped as much as 5 percent in early Hong Kong trading Thursday after reports that China plans further curbs on gaming.
A Messy Divorce
The performance of China tech stocks tracked their U.S. peers until a sudden split about two months ago
There are several reasons for the swoon. In June, the U.S. trade war started to undermine the confidence of Chinese consumers, on whom internet companies rely. The latest earnings season was ugly, with second-quarter profit growth slowing to 16.2 percent, from 47 percent a year earlier.
But there are reasons to believe the divergence is structural and here to stay.
Take a look at the valuations of Tencent and Alibaba. Despite weak earnings, the pair are trading within their historical price-earnings range. On a price-to-sales basis, though, they’ve fallen off a cliff.
Deflated Balloon
Alibaba's and Tencent's valuations on a price-to-sales basis tumbled in recent months as investors worried about their spending
In other words, investors no longer believe that a dollar of sales from China tech can trickle down to shareholders the way it did in the past.
China tech’s spending spree is alarming. This year, Alibaba, Tencent and JD.com Inc. have already splashed out more than $37 billion on stakes in startups. You hardly see this kind of venture-capital generosity from Amazon or Apple.
»»» Read More…
• DiscoverGold
Information posted to this board is not meant to suggest any specific action, but to point out the technical signs that can help our readers make their own specific decisions. Your Due Dilegence is a must!
• DiscoverGold
Recent BABA News
- Form 6-K - Report of foreign issuer [Rules 13a-16 and 15d-16] • Edgar (US Regulatory) • 09/13/2024 08:01:58 PM
- Apple Loses EU Dispute; Google’s $2.7 Billion Fine Upheld; Oracle Shares Surge 9% • IH Market News • 09/10/2024 10:02:31 AM
- Form 6-K - Report of foreign issuer [Rules 13a-16 and 15d-16] • Edgar (US Regulatory) • 09/06/2024 08:00:22 PM
- Broadcom Down 10% Post-Earnings, UiPath Up 8%; Qualcomm Eyes Intel Assets; Salesforce Acquires Own Company • IH Market News • 09/06/2024 11:59:00 AM
- Form 6-K - Report of foreign issuer [Rules 13a-16 and 15d-16] • Edgar (US Regulatory) • 09/05/2024 08:01:03 PM
- Alibaba.com and Mastercard Team up to Launch U.S. Co-Branded Business Credit Card Powered by Cardless • PR Newswire (US) • 09/05/2024 06:00:00 PM
- Alibaba.com Unveils Game-Changing AI Sourcing Agent, Helping SMEs Simplify Global Trade • PR Newswire (US) • 09/05/2024 06:00:00 PM
- Qualcomm Develops Mixed Reality Glasses; Verizon to Boost Dividend, Eyes Acquisition; Samsonite Plans US Dual Listing • IH Market News • 09/05/2024 10:11:35 AM
- Alibaba International Wraps Up 2024 Global E-Commerce Challenge, Highlighting Youth Innovation • PR Newswire (US) • 09/04/2024 01:34:00 PM
- Alibaba International Wraps Up 2024 Global E-Commerce Challenge, Highlighting Youth Innovation • PR Newswire (US) • 09/04/2024 01:13:00 PM
- High Volatility Expected in Nvidia Report, Ambarella Soars 20%, Hertz Strengthens Board, Apple Cuts Jobs • IH Market News • 08/28/2024 09:50:36 AM
- Cruise and Uber Join Forces for Robotaxis, Alibaba Shifts Primary Listing to Hong Kong, Altria Hikes Dividend 4.1% • IH Market News • 08/23/2024 12:20:26 PM
- Alibaba Group Announces June Quarter 2024 Results • Business Wire • 08/15/2024 10:30:00 AM
- U.S. Futures Rise on Easing Inflation, Oil Prices Rise • IH Market News • 08/15/2024 10:09:48 AM
- Google Forced to Modify Play Store, Apple Innovates, Victoria’s Secret Hires CEO, Mars Buys Kellanova • IH Market News • 08/15/2024 10:05:46 AM
- Google Mandated to Modify Play Store, Apple Innovates, Victoria’s Secret Hires CEO, Mars Buys Kellanova • IH Market News • 08/15/2024 10:05:46 AM
- Form 13F-HR - Quarterly report filed by institutional managers, Holdings • Edgar (US Regulatory) • 08/14/2024 08:03:09 PM
- Starbucks Rises 3%; Disney Unveils New Films and Expansions; Uber CEO Questions Tesla Robotaxi Viability, and More • IH Market News • 08/12/2024 09:46:16 AM
- TSMC July Revenue Surges 45%, Nasdaq Accelerates Penny Stock Delistings, Moody’s Downgrades Intel to BAA1, and More • IH Market News • 08/09/2024 09:44:44 AM
- Alibaba Group Will Announce June Quarter 2024 Results on August 15, 2024 • Business Wire • 08/02/2024 09:00:00 AM
- Apple Delays AI Features, Abbott Shares Plunge 7% After $495M Fine, Philips Soars 10% • IH Market News • 07/29/2024 10:24:10 AM
- NBA Signs $77 Billion Broadcast Deal, CrowdStrike Criticized for Insufficient Reward, Honda Shuts Down Chinese Factory • IH Market News • 07/25/2024 10:15:46 AM
- Europeans Inspired to Get Active During 2024 Summer of Sports, Reveals AliExpress Consumer Insights Report • PR Newswire (US) • 07/25/2024 07:00:00 AM
FEATURED Element79 Gold Corp. Appoints Kevin Arias as Advisor to the Board of Directors, Strengthening Strategic Leadership • Sep 18, 2024 10:29 AM
Mawson Finland Limited Further Expands the Known Mineralized Zones at Rajapalot: Palokas step-out drills 7 metres @ 9.1 g/t gold & 706 ppm cobalt • MFL • Sep 17, 2024 9:02 AM
PickleJar Announces Integration With OptCulture to Deliver Holistic Fan Experiences at Venue Point of Sale • PKLE • Sep 17, 2024 8:00 AM
North Bay Resources Announces Mt. Vernon Gold Mine Bulk Sample, Sierra County, California • NBRI • Sep 11, 2024 9:15 AM
One World Products Issues Shareholder Update Letter • OWPC • Sep 11, 2024 7:27 AM
Kona Gold Beverage Inc. Reports $1.225 Million in Revenue and $133,000 Net Profit for the Quarter • KGKG • Sep 10, 2024 1:30 PM