Alibaba Stock (BABA) Sell-Off May Have Further to Run
Tip Ranks·
- Alibaba recently announced a 10.2 billion USD equity placement and reported a 30% drop in adjusted EBITA despite a 9% rise in fiscal first-quarter revenue to 39.64 billion USD.
- Heavy capital expenditures of nearly 10 billion USD for cloud and artificial intelligence drove free cash flow into a 6.58 billion USD outflow.
- The company faces continued downward pressure on its stock due to slowing commerce, unproven artificial intelligence economics, and potential share dilution for current holders.