As most frequent followers know, I’m allocating up to 10% of my dividend growth portfolio for undervalued stock opportunities. I firmly believe that Alibaba is such an opportunity for me right now.
At the same time it’s one of the most controversial stocks to buy as can be witnessed by the many different points of view on social media.
I respect all those viewpoints and all I can say is this:
If you don’t feel comfortable investing in Alibaba or Chinese stocks at all, then don’t!
The stock metaverse is really huge and there are still enough other opportunities out there. Don’t feel that you would be missing out on something. Buying because others are buying without understanding the risk your taking might really get you into trouble.
Hence, Investing carries risk and you might simply lose everything.
That’s one of the reasons why I manage my portfolio in tiers which allows me to limit my single stock risk. My position in Alibaba is no exception to that.
Having said all of this, in this video I will share with you why I think Alibaba stock is trading at 145 USD right now.
I’ll share with you my thoughts on the common prosperity fund contribution and what it means for it’s valuation. After that I will walk you through the 3 main risk I see for Alibaba stock and how I manage those risks.
Once done, I’ll run you through some valuation metrics, before I will provide you with my Discounted Cash Flow calculation for Alibaba’s stock.
I hope you enjoy this video and I’m looking forward for your thoughts in the comments.
Chapters
- 00:00 – Intro and Alibaba story
- 02:14 – Why the stock is falling like a knife
- 03:12 – My thoughts about the common prosperity fund
- 04:46 – Stock fundamentals
- 07:20 – The risks I see and how much I discount for them
- 09:00 – Some basic valuation metrics
- 10:04 – AliBaba Discounted Cash Flow valuation
- 14:52 – How much Alibaba stock I own and what I’ll do next
Yours Truly,
European Dividend Growth Investor
