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All the hysteria about new Chinese government regulations overshadowed the fact that Alibaba released results a few days ago. Although revenues missed estimates slightly, they still grew by 33.8% off of a very high base.
Active users grew by 11.6% to 828 million and earnings per share rose by 12%. Cloud services is becoming a big deal for Alibaba, as is has for the US tech giants. That division grew by 29%.
Alibaba now trades at 20 times forward earnings which is a steal for a business growing at this pace. To take advantage of the recent share price sell-off, the company said that they were increasing their share buyback program from $10 billion to $15 billion.
If the regulatory environment relaxes, the share price will rally. That's a big IF though! It's easier to predict the movements of the Rand right now than the next intervention by the Chinese government. If you already own Alibaba, keep them. If you don't, rather buy Amazon.
