Alibaba: Buy E-Commerce And Cloud, Get The Strategic Investment Portfolio For Free (NYSE:BABA)

Alibaba (NYSE:BABA) has a lot going for it – not only is it a key beneficiary of secular drivers such as an ever-growing consumption-driven economy and the shift to e-commerce, but its ability to funnel that cash flow into profitable growth opportunities (e.g., cloud and logistics) leaves me incrementally bullish post-investor day. While the event is unlikely to result in major changes to consensus estimates, the long-term shift in focus toward a more balanced approach to growth and margins likely underpins sustained, long-term earnings growth, in my view. At current valuations, I believe the market is assigning value only to the core business and cloud, granting investors access to BABA’s ~$114bn strategic investment portfolio for free.

Outlining the Long-Term Drivers

CEO Daniel Zhang outlined the scale of his long-term vision at the event – this includes serving a massive 2bn global customers, facilitating the creation of 100m new jobs, and

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