Alibaba just traded at $104, up $12 on the day. That’s a PE of only 12 against it’s peak earnings (from 2021) of $8.54 per share. On the surface that seems super cheap, given it’s history of extremely rapid growth. But there are two problems. First is the last two quarters have seen BABA’s revenues shrink*. But more importantly BABA’s entire history shows troubling signs of a massive ongoing decline in business quality.
Alibaba's deteriorating business quality
Alibaba's deteriorating business quality
Alibaba's deteriorating business quality
Alibaba just traded at $104, up $12 on the day. That’s a PE of only 12 against it’s peak earnings (from 2021) of $8.54 per share. On the surface that seems super cheap, given it’s history of extremely rapid growth. But there are two problems. First is the last two quarters have seen BABA’s revenues shrink*. But more importantly BABA’s entire history shows troubling signs of a massive ongoing decline in business quality.