Alibaba stock still looks pricey despite the recent selloff. Less than a year after the Chinese web giant's record $25 billion initial public offering, its shares have dropped below their $68 IPO price. Though macroeconomic worries have afflicted all Chinese companies, the group founded by Jack Ma is still highly valued when compared with rivals.
Shares in the New York-listed company hit $120 as recently as November. On August 24 they closed at $65.8. Slumping Chinese stocks and worries about an economic slowdown are partly to blame. Bank of New York Mellon's index of US-listed Chinese stocks is down 16 percent since the beginning of the month.
Disappointing results have helped to wipe $100 billion from Alibaba's market capitalisation since its peak. Revenue for the quarter ending June grew at its slowest rate in three years. Investors and employees whose shareholdings were locked up following the IPO will be free to sell next month, further weighing on the stock.
Even so, the $165 billion company hardly looks cheap. Start by stripping out investments such as its potential 33 percent shareholding in financial services affiliate Ant Financial. Based on Ant's latest valuation reported by Reuters, that stake is worth $14.9 billion.
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