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MrNikki

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2021-06-24

👌🏻

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2021-06-24

Sure bo

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2021-06-23

Hmm

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2021-06-23

More growth

Why I Believe NIO Will Beat Out Tesla

2021-06-21

Chargepoint?

Plug Power: This Stock Fails To Get Us Charged Up

2021-06-21

Interesting

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2021-06-18

Nice

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2021-06-18

BABA

Alibaba Stock: The Bottoming Process Looks To Be Forming Already

2021-06-17

Good read

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2021-06-16

Big money

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growth","listText":"More growth","text":"More growth","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://laohu8.com/post/121064484","repostId":"1145825451","repostType":4,"repost":{"id":"1145825451","kind":"news","pubTimestamp":1624433586,"share":"https://www.laohu8.com/m/news/1145825451?lang=&edition=full","pubTime":"2021-06-23 15:33","market":"us","language":"en","title":"Why I Believe NIO Will Beat Out Tesla","url":"https://stock-news.laohu8.com/highlight/detail?id=1145825451","media":"InvestorPlace","summary":"The fact that Tesla scrapped its Model S Plaid Plus release is just part of it.Super fans of the latest and greatest high-endTesla, Inc. model received some disappointing news a week ago when CEO Elon Musk abruptly canceled the release of its highly anticipated Model S Plaid Plus with a tweet on June 6.Instead, the company has begun delivering a new Model S Plaid that has only a 390-mile range and 1,020 horsepower, though it still sprints to from 0 to 60 miles per hour in just two seconds.The go","content":"<blockquote>\n <b>The fact that Tesla scrapped its Model S Plaid Plus release is just part of it.</b>\n</blockquote>\n<p>Super fans of the latest and greatest high-end<b>Tesla, Inc.</b>(NASDAQ:<b>TSLA</b>) model received some disappointing news a week ago when CEO Elon Musk abruptly canceled the release of its highly anticipated Model S Plaid Plus with a tweet on June 6.</p>\n<p><img src=\"https://static.tigerbbs.com/b294a3604c7ba82bd19b3c70be3a4020\" tg-width=\"300\" tg-height=\"169\" referrerpolicy=\"no-referrer\">Source: nrqemi / Shutterstock.com</p>\n<p>Musk wrote there was… “No need, as Plaid is just so good.”</p>\n<p>The Model S Plaid Plus was supposed to be the fastest, most powerful and priciest version of the company’s Model S. Priced at $149,990, it was to feature a range of 520 miles, thanks to its innovative 4680 battery cells, 1,100 horsepower and the ability to speed from 0 to 60 mph in less than two seconds.</p>\n<p>Instead, the company has begun delivering a new Model S Plaid that has only a 390-mile range and 1,020 horsepower, though it still sprints to from 0 to 60 miles per hour in just two seconds.</p>\n<p>As a way to “sugar coat” its flip flop, Tesla said the Model S Plaid is just as fast as the Model S Plaid Plus and $20,000 cheaper. Humm.</p>\n<p>This “bait and switch” has some Tesla fans worried, since they had deposits on the Model S Plaid Plus and wanted the innovative 4680 battery cells that Tesla had been touting as the key to longer range and more power. Essentially, the 4680 battery cells were the latest great Tesla development, since they were the first batteries to also be a structural component that supposedly allowed Tesla to lower the weight of its vehicles.</p>\n<p>Both the company’s Austin and Berlin manufacturing plants now under construction are supposed to also be making the 4680 batteries for new Tesla vehicles. If there is a problem with the engineering associated with utilizing the 4680 batteries or making them a structural component, then Tesla has grossly miscalculated, which is now worrying investors.</p>\n<p>Clearly something happened to delay the 4680 batteries that were supposed to provide Tesla with a competitive and engineering edge. For Tesla’s sake, I hope they figure out the problems associated with their much hyped 4680 battery cells, otherwise concerns about its two new manufacturing plants will emerge, as well as the stock losing more of its “mojo.”</p>\n<p>As someone who owns more than a few high-performance vehicles, I can tell you that the engineering geeks I know do<i>not</i>want to get a new Model S Plaid instead of a Model S Plaid Plus and will likely ask for their deposits back.</p>\n<p>What Tesla did is like Ferrari or Porsche telling its customers that one of their much-hyped new performance models is now not being sold because the base model was just as good! Car fanatics, like myself, like the latest and greatest engineering tidbits, so we would rather cancel our orders versus settle for a base model.</p>\n<p>The good news for Tesla is that its China sales in May resurged to 21,936, up sharply from 11,671 in April. The company’s sales tend to spike at the end of each quarter. For example, Tesla sold 35,478 vehicles in China in March, which was the strongest month ever in China.</p>\n<p>This is raising expectations for very strong China sales in June, especially now that the Model Y is being manufactured in Shanghai. Interestingly, since most Chinese Teslas are now made with iron phosphate batteries, these vehicles have lower range than its lithium cobalt vehicles, but its iron phosphate vehicles are cheaper and now increasingly being exported to Europe.</p>\n<p>However, I’m convinced another electric vehicle (EV) company will eventually displace Tesla as the biggest manufacturer of EVs in China.</p>\n<p><b>Taking Advantage of the EV Revolution’s Profit Potential</b></p>\n<p>I’m talking about&nbsp;<b>Nio, Inc.</b>(NYSE:<b>NIO</b>). The reality is that this company is on the verge of dominating the EV market in China and Hong Kong. It’s why I put NIO on my<b><i>Platinum Growth Club</i></b>Model Portfolio back in February.</p>\n<p>The company boasts that it is the “next-generation car company,” as it designs and manufactures electric vehicles that utilize the latest technologies in connectivity, autonomous driving and artificial intelligence (AI). NIO currently offers an electric seven-seater SUV (ES8) and a five-seater electric SUV (ES6) and recently introduced an attractive electric sedan (ET7). Its vehicles utilize NOMI, an in-vehicle artificial intelligence assistant.</p>\n<p>The company is also partnering with cutting-edge chip companies like<b>NVIDIA Corporation</b>(NASDAQ:<b>NVDA</b>), another one of my<b><i>Platinum Growth Club</i></b>Model Portfolio stocks. NIO plans to use the NVIDIA DRIVE Orin system-on-a-chip for its electric vehicles that will provide autonomous driving capabilities. The NVIDIA DRIVE Orin-powered supercomputer, which is being called Adam, will be launched in the ET7 sedan in China in 2022. Announcements like this are very positive, so NIO has been stealing some of Tesla’s thunder lately.</p>\n<p>Now, it’s important to note that NIO was bailed out by the Chinese government. Last year, the Chinese government injected $1 billion and now has a 24% ownership in the company. The reality is that China wants to dominate at least five major industries by 2025, and NIO is now its ticket to dominate EV manufacturing.</p>\n<p>With the backing of the Chinese government, some Wall Street firms are eager to help NIO by issuing new debt or equity. So, I wouldn’t be surprised if NIO surpasses Tesla, which is currently number-two in China, for market share in the upcoming years.</p>\n<p>That means, if you missed Tesla’s parabolic run like I did, NIO is essentially giving us a “second chance” to make money in a potentially explosive electric vehicle company.</p>\n<p>Shares of NIO climbed nearly 13% since the company’s June 4 announcement of its May delivery report and positive analyst comments, while Tesla shares rose almost 3%. First, NIO revealed that the global chip shortage is starting to take a toll on its business. NIO only delivered 6,711 vehicles in May, or a 5.5% decline from April’s deliveries. Company management noted that deliveries were “adversely impacted for several days due to the volatility of semiconductor supply and certain logistical adjustments.”</p>\n<p>Interestingly, despite the month-to-month dip, NIO’s deliveries were still up 95.3% year-over-year. Strong demand in China even inspired a Citigroup analyst to upgrade NIO to a buy rating, as he expects demand to accelerate in the coming months.</p>\n<p>In other words, NIO represents the<b>crème de la crème</b>of EV stocks right now.</p>","source":"lsy1606302653667","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Why I Believe NIO Will Beat Out Tesla</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nWhy I Believe NIO Will Beat Out Tesla\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-06-23 15:33 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://investorplace.com/2021/06/why-i-believe-nio-will-beat-out-tesla/><strong>InvestorPlace</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The fact that Tesla scrapped its Model S Plaid Plus release is just part of it.\n\nSuper fans of the latest and greatest high-endTesla, Inc.(NASDAQ:TSLA) model received some disappointing news a week ...</p>\n\n<a href=\"https://investorplace.com/2021/06/why-i-believe-nio-will-beat-out-tesla/\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{},"source_url":"https://investorplace.com/2021/06/why-i-believe-nio-will-beat-out-tesla/","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1145825451","content_text":"The fact that Tesla scrapped its Model S Plaid Plus release is just part of it.\n\nSuper fans of the latest and greatest high-endTesla, Inc.(NASDAQ:TSLA) model received some disappointing news a week ago when CEO Elon Musk abruptly canceled the release of its highly anticipated Model S Plaid Plus with a tweet on June 6.\nSource: nrqemi / Shutterstock.com\nMusk wrote there was… “No need, as Plaid is just so good.”\nThe Model S Plaid Plus was supposed to be the fastest, most powerful and priciest version of the company’s Model S. Priced at $149,990, it was to feature a range of 520 miles, thanks to its innovative 4680 battery cells, 1,100 horsepower and the ability to speed from 0 to 60 mph in less than two seconds.\nInstead, the company has begun delivering a new Model S Plaid that has only a 390-mile range and 1,020 horsepower, though it still sprints to from 0 to 60 miles per hour in just two seconds.\nAs a way to “sugar coat” its flip flop, Tesla said the Model S Plaid is just as fast as the Model S Plaid Plus and $20,000 cheaper. Humm.\nThis “bait and switch” has some Tesla fans worried, since they had deposits on the Model S Plaid Plus and wanted the innovative 4680 battery cells that Tesla had been touting as the key to longer range and more power. Essentially, the 4680 battery cells were the latest great Tesla development, since they were the first batteries to also be a structural component that supposedly allowed Tesla to lower the weight of its vehicles.\nBoth the company’s Austin and Berlin manufacturing plants now under construction are supposed to also be making the 4680 batteries for new Tesla vehicles. If there is a problem with the engineering associated with utilizing the 4680 batteries or making them a structural component, then Tesla has grossly miscalculated, which is now worrying investors.\nClearly something happened to delay the 4680 batteries that were supposed to provide Tesla with a competitive and engineering edge. For Tesla’s sake, I hope they figure out the problems associated with their much hyped 4680 battery cells, otherwise concerns about its two new manufacturing plants will emerge, as well as the stock losing more of its “mojo.”\nAs someone who owns more than a few high-performance vehicles, I can tell you that the engineering geeks I know donotwant to get a new Model S Plaid instead of a Model S Plaid Plus and will likely ask for their deposits back.\nWhat Tesla did is like Ferrari or Porsche telling its customers that one of their much-hyped new performance models is now not being sold because the base model was just as good! Car fanatics, like myself, like the latest and greatest engineering tidbits, so we would rather cancel our orders versus settle for a base model.\nThe good news for Tesla is that its China sales in May resurged to 21,936, up sharply from 11,671 in April. The company’s sales tend to spike at the end of each quarter. For example, Tesla sold 35,478 vehicles in China in March, which was the strongest month ever in China.\nThis is raising expectations for very strong China sales in June, especially now that the Model Y is being manufactured in Shanghai. Interestingly, since most Chinese Teslas are now made with iron phosphate batteries, these vehicles have lower range than its lithium cobalt vehicles, but its iron phosphate vehicles are cheaper and now increasingly being exported to Europe.\nHowever, I’m convinced another electric vehicle (EV) company will eventually displace Tesla as the biggest manufacturer of EVs in China.\nTaking Advantage of the EV Revolution’s Profit Potential\nI’m talking about Nio, Inc.(NYSE:NIO). The reality is that this company is on the verge of dominating the EV market in China and Hong Kong. It’s why I put NIO on myPlatinum Growth ClubModel Portfolio back in February.\nThe company boasts that it is the “next-generation car company,” as it designs and manufactures electric vehicles that utilize the latest technologies in connectivity, autonomous driving and artificial intelligence (AI). NIO currently offers an electric seven-seater SUV (ES8) and a five-seater electric SUV (ES6) and recently introduced an attractive electric sedan (ET7). Its vehicles utilize NOMI, an in-vehicle artificial intelligence assistant.\nThe company is also partnering with cutting-edge chip companies likeNVIDIA Corporation(NASDAQ:NVDA), another one of myPlatinum Growth ClubModel Portfolio stocks. NIO plans to use the NVIDIA DRIVE Orin system-on-a-chip for its electric vehicles that will provide autonomous driving capabilities. The NVIDIA DRIVE Orin-powered supercomputer, which is being called Adam, will be launched in the ET7 sedan in China in 2022. Announcements like this are very positive, so NIO has been stealing some of Tesla’s thunder lately.\nNow, it’s important to note that NIO was bailed out by the Chinese government. Last year, the Chinese government injected $1 billion and now has a 24% ownership in the company. The reality is that China wants to dominate at least five major industries by 2025, and NIO is now its ticket to dominate EV manufacturing.\nWith the backing of the Chinese government, some Wall Street firms are eager to help NIO by issuing new debt or equity. So, I wouldn’t be surprised if NIO surpasses Tesla, which is currently number-two in China, for market share in the upcoming years.\nThat means, if you missed Tesla’s parabolic run like I did, NIO is essentially giving us a “second chance” to make money in a potentially explosive electric vehicle company.\nShares of NIO climbed nearly 13% since the company’s June 4 announcement of its May delivery report and positive analyst comments, while Tesla shares rose almost 3%. First, NIO revealed that the global chip shortage is starting to take a toll on its business. NIO only delivered 6,711 vehicles in May, or a 5.5% decline from April’s deliveries. Company management noted that deliveries were “adversely impacted for several days due to the volatility of semiconductor supply and certain logistical adjustments.”\nInterestingly, despite the month-to-month dip, NIO’s deliveries were still up 95.3% year-over-year. Strong demand in China even inspired a Citigroup analyst to upgrade NIO to a buy rating, as he expects demand to accelerate in the coming months.\nIn other words, NIO represents thecrème de la crèmeof EV stocks right now.","news_type":1},"isVote":1,"tweetType":1,"viewCount":431,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":167297166,"gmtCreate":1624269113155,"gmtModify":1634008647977,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"Chargepoint?","listText":"Chargepoint?","text":"Chargepoint?","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":0,"repostSize":0,"link":"https://laohu8.com/post/167297166","repostId":"1196746626","repostType":4,"repost":{"id":"1196746626","kind":"news","pubTimestamp":1624268221,"share":"https://www.laohu8.com/m/news/1196746626?lang=&edition=full","pubTime":"2021-06-21 17:37","market":"us","language":"en","title":"Plug Power: This Stock Fails To Get Us Charged Up","url":"https://stock-news.laohu8.com/highlight/detail?id=1196746626","media":"seekingalpha","summary":"Summary\n\nPlug Power, the producer of hydrogen fuel cell solutions, has had a turbulent history, with","content":"<p><b>Summary</b></p>\n<ul>\n <li>Plug Power, the producer of hydrogen fuel cell solutions, has had a turbulent history, with the stock trading at just a fraction of its 1999 tech boom price.</li>\n <li>Despite experiencing a renaissance in the 2020 tech and growth surge, the stock appears to be re-rating back to its earlier valuation multiple as investor optimism falters.</li>\n <li>Management has high hopes for the future, with an impressive slide-deck published in the fall of 2020 laying out how they see the company developing in the near future.</li>\n <li>While forecasts are impressive to read, investors should consider whether there is enough substance in the numbers to back them up.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/cd52b10176701b73dd7d557921bfd29e\" tg-width=\"768\" tg-height=\"480\"><span>3alexd/E+ via Getty Images</span></p>\n<p><b>Investment Thesis</b></p>\n<p>Despite a strong end to 2020, fuelled by investor optimism for all things linked to our clean and green future, this stock appears to be re-rating back to its former valuation multiple.While there are many factors investors will point towards to support a bull thesis, in our opinion many forward-looking projections are overly ambitious and may ultimately be out of reach. We question whether the total addressable market is significant enough for Plug to prosper, particularly in the light of strong competition.</p>\n<p><b>The Background to our thesis</b></p>\n<p>Plug Power (PLUG) was a roaring success in the latter part of 2020, increasing by over 400% to its January 2021 peak, before crashing back down to earth as the stock was hit by an&nbsp;accounting scandal.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/7c03000d0db7000dd850fad52fdd9068\" tg-width=\"635\" tg-height=\"403\"><span>Data by YCharts</span></p>\n<p>The accounting issues have been covered in detail in the article linked above, so we won’t pore over them in too much detail here, except to say we are big believers in the old adage - “if in doubt, get out.\" An accounting scandal and a restatement of prior year figures is perhaps not the wisest foundations with which to build an investment decision in our opinion.</p>\n<p>Whether an accounting scandal is considered a red flag from an investment thesis or not, most investors would baulk at the thought of investing in a firm with legal concerns and unknown liabilities. Unfortunately, for PLUG stockholders, that is exactly what is laid out in the company’s most recent&nbsp;annual report, with a flurry of legal proceedings being filed in early 2021 off the back of the accounting scandal, adding to earlier proceedings from staff involved in an accident which is yet to be resolved. For many investors, these flags would be enough to deter them from an investment. However, a contrary argument may be that these factors are already priced in and the company's future may be rosier. Let's consider what the future holds for Plug Power.</p>\n<p><b>Considering Plug Power's Valuation</b></p>\n<p>As long-term growth investors, the consideration of valuation is not normally the first port of call when considering an investment decision. We’ve previously laid out our belief that what seems expensive, often is so for good reason, when laying out a bull thesis for other stocks. However, in this case we think it paints a very different story. When considering the valuation of Plug Power, we note a current enterprise value of $16.1 billion, being a $16.8 billion market cap, deducting $1.3 billion cash and adding $0.6 billion in debt. This gives us a forward looking EV/Sales figure for the next twelve months of 36.</p>\n<p>While the multiple itself is high by most gauges, as we’ve outlined, the number itself is not really our primary concern. If we delve a little deeper into the valuation story, what we can see is a company that traded at 3.8 times its next twelve-month revenues in September 2019 (using the same metrics outlined above). This multiple increased gradually to 12.3 by June 2020, before exploding as high as 56 times next twelve-month sales in December 2020.</p>\n<p>This incredible volatility in valuation multiple does not appear to have been triggered by developing sales or profitability. PLUG's quarter-on-quarter last twelve-month sales increased a modest 50% between September 2019 and September 2020 ($198 million September 2019 and $308 million September 2020). Thereafter a large decline, caused by their accounting irregularities, led to a December 2020 loss of $94 million.</p>\n<p>It's our thesis that the stock price surge was not built on any solid financial foundation, more likely linked to investor appetite for exposure to companies that may benefit from future environmental trends, and potentially the strong forecasts from management. As the projections have not yet played out in the numbers, the share price has suffered and this is a trend we expect to continue to see.</p>\n<p>One positive case that can be made for PLUG's future from a valuation perspective is that despite negatively trending income statement features, the company appears to have a strong balance sheet. The considerable cash and cash equivalent balance ($1.3 billion) by far surpasses their current and long-term liabilities ($784 million), meaning PLUG should have no issues in withstanding short-term poor performance.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a02d2db1e6065bc1e3501e02da38a16a\" tg-width=\"624\" tg-height=\"229\"><span>(Source: PLUG's 2020 Annual report)</span></p>\n<p>The company's current ratio of 7.21, being current assets divided by current liabilities, suggests a company more than able to continue operations despite being in a loss-making position.While this is encouraging from a bull thesis perspective, our core investment strategy is more revenue and growth orientated. PLUG certainly appears to be well capitalized, yet that alone will not enable the company to drive returns for investors. One obvious option for PLUG would be to deploy their cash into projects that would develop new revenue streams and enhance their earnings position.</p>\n<p><b>Consideration of growth opportunities</b></p>\n<p>Since we deviated from our normal order of assessment, let’s now return to where the thesis normally begins, that is the story of the company itself. Do we consider this investment story to paint a positive picture of future growth, with products that will change the company fortunes and lead to a prosperous future? If we’re honest, right now, no. Let’s assess why that is the case.</p>\n<p>Firstly, PLUG is a producer of hydrogen powered fuel cell solutions, outlining in their recent&nbsp;annual report&nbsp;that they see their products in “material handling vehicles and industrial trucks.\" This is the first factor that investors should be acutely aware of. The hype of 2020 may have gotten some investors carried away with this “battery producer” for electric vehicles, without understanding its position in the market.</p>\n<p>The vehicle battery market is well laid out by this&nbsp;IHS Markit report, which considers the future prospects for hydrogen fuel cells. If you’re bullish on PLUG, this report will give some encouragement, showing that there is a strong increase expected in both vehicles and charging stations in the coming years.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/c627200e94e6301508a5f09d5381a43b\" tg-width=\"640\" tg-height=\"251\"><span>(Source:IHS Markit)</span></p>\n<p>However, it’s not the headline numbers that caught our eye in this report, but the description of where exactly hydrogen-powered batteries sit within the marketplace. According to the report, while there are clear benefits of hydrogen over the lithium batteries used by Tesla and others, the downside is that they use “more complex processes” and have “about half the wheel to wheel efficiency of battery electric,” concluding that they are more suitable for vehicles with heavier weights and longer trip times – think industrial vehicles and buses.</p>\n<p>In our consideration of the story, this dramatically reduces the total addressable market (\"TAM\"). Yes, there are a lot of industrial vehicles in the world, but there is a significantly larger market for standard lighter automobiles, boats, light-aircraft and drones.</p>\n<p>Our assessment of the story is enhanced further by reporting from the International Energy Agency, who lay out their future projections for electric light duty vehicles (“LDV”) in the graph below – electric cars essentially. With projections for up to 200 million units expected to be on the road in 2030, up from 22 million today. In our opinion, if investing in the clean and green future of electric vehicles, the LDV space is far more appealing, and the smaller TAM in the hydrogen fuel cell space is a concern to the company's long-term prospects.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/59bfbab3f6732c318b381f6832adfd3d\" tg-width=\"640\" tg-height=\"342\"><span>(Source :IEA 2021 Report)</span></p>\n<p><b>The contrary thesis for PLUG</b></p>\n<p>We should also consider the counter argument to our thesis on the PLUG story. The bulls will be screaming that despite the smaller market, many companies have been highly profitable while cornering a certain segment of a larger market. That would undoubtedly be a fair assessment to make overall; however, do we consider that PLUG is best placed to do so?</p>\n<p>In the heavy duty vehicle and hydrogen power market, there are already firms such as Proterra (PTRA), who have proof of concept and regular sales in electric buses. Plus it has become apparent that heavyweight competitors are entering the space, with General Motors' (GM&nbsp;)plans to supply&nbsp;fuel cells for locomotive trains. With this in mind, it is difficult to see PLUG capturing a significant portion of the smaller TAM that we defined earlier. Our thesis is that they may get squeezed out by this competition in the longer term.</p>\n<p>That being said, the company management clearly forecasts a bright future. Their impressive September 2020&nbsp;slide deck&nbsp;highlights their forecasts of an incredible surge in revenue growth to $1.2 billion in annual sales and $250 billion in operating EBITDA. This impressive growth will be fuelled by expansion of their existing operations and development of new market segments, such as hydrogen power plants, refueling stations, heavy duty electric vehicles, airplanes and even a \"gigafactory.\"</p>\n<p>The coining of a phrase synonymous with Tesla, via their gigafactory plans, may have whet the appetite of some investors. However, we are firmly in the let’s wait and see camp here. Firstly, on the revenue side, even excluding the 2020 annual loss and writing off to the restatement issues mentioned earlier, it’s hard to gather where the $1 billion figure comes from. That would be an approximate 6.5-fold increase on the 2019 annual revenues ($150 million) in a two and a half year period; pretty ambitious? Not quite as ambitious as doing so while increasing EBITDA to $250 million from a historic loss-making position, while presumably also increasing capital expenditure to fund their gigafactory, hydrogen plant, plane and truck expansions? Unfortunately, we are struggling to see the math.</p>\n<p><b>Our conclusions on Plug Power</b></p>\n<p>In a global environment currently shifting toward a greener and cleaner world, fuelled by more carbon efficient vehicles, it is no surprise that investors have high hopes for a stock such as PLUG. It is easy to read their marketing material and fall in love with the story and the projections. It's encouraging to see the bold plans that management have for the company; however, we would like to see more results before assuming that these can be executed.</p>\n<p>From the research we have undertaken, we believe that the total addressable market for PLUG is smaller than currently perceived by the bulls. Long-term trends suggest that lithium batteries will be the clear leader in fuelling our greener future and we believe the hydrogen market will be considerably smaller, impacting PLUG's ability to grow. When considering this, alongside the strong competition within their subsector, the accounting and litigation red flags we noted earlier, we believe that PLUG may continue to see multiple contraction and a reduction in market cap - hence our bearish outlook at this point in time.</p>","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Plug Power: This Stock Fails To Get Us Charged Up</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; 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}\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nPlug Power: This Stock Fails To Get Us Charged Up\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-06-21 17:37 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4435786-plug-power-this-stock-fails-to-get-us-charged-up><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nPlug Power, the producer of hydrogen fuel cell solutions, has had a turbulent history, with the stock trading at just a fraction of its 1999 tech boom price.\nDespite experiencing a ...</p>\n\n<a href=\"https://seekingalpha.com/article/4435786-plug-power-this-stock-fails-to-get-us-charged-up\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"PLUG":"普拉格能源"},"source_url":"https://seekingalpha.com/article/4435786-plug-power-this-stock-fails-to-get-us-charged-up","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1196746626","content_text":"Summary\n\nPlug Power, the producer of hydrogen fuel cell solutions, has had a turbulent history, with the stock trading at just a fraction of its 1999 tech boom price.\nDespite experiencing a renaissance in the 2020 tech and growth surge, the stock appears to be re-rating back to its earlier valuation multiple as investor optimism falters.\nManagement has high hopes for the future, with an impressive slide-deck published in the fall of 2020 laying out how they see the company developing in the near future.\nWhile forecasts are impressive to read, investors should consider whether there is enough substance in the numbers to back them up.\n\n3alexd/E+ via Getty Images\nInvestment Thesis\nDespite a strong end to 2020, fuelled by investor optimism for all things linked to our clean and green future, this stock appears to be re-rating back to its former valuation multiple.While there are many factors investors will point towards to support a bull thesis, in our opinion many forward-looking projections are overly ambitious and may ultimately be out of reach. We question whether the total addressable market is significant enough for Plug to prosper, particularly in the light of strong competition.\nThe Background to our thesis\nPlug Power (PLUG) was a roaring success in the latter part of 2020, increasing by over 400% to its January 2021 peak, before crashing back down to earth as the stock was hit by an accounting scandal.\nData by YCharts\nThe accounting issues have been covered in detail in the article linked above, so we won’t pore over them in too much detail here, except to say we are big believers in the old adage - “if in doubt, get out.\" An accounting scandal and a restatement of prior year figures is perhaps not the wisest foundations with which to build an investment decision in our opinion.\nWhether an accounting scandal is considered a red flag from an investment thesis or not, most investors would baulk at the thought of investing in a firm with legal concerns and unknown liabilities. Unfortunately, for PLUG stockholders, that is exactly what is laid out in the company’s most recent annual report, with a flurry of legal proceedings being filed in early 2021 off the back of the accounting scandal, adding to earlier proceedings from staff involved in an accident which is yet to be resolved. For many investors, these flags would be enough to deter them from an investment. However, a contrary argument may be that these factors are already priced in and the company's future may be rosier. Let's consider what the future holds for Plug Power.\nConsidering Plug Power's Valuation\nAs long-term growth investors, the consideration of valuation is not normally the first port of call when considering an investment decision. We’ve previously laid out our belief that what seems expensive, often is so for good reason, when laying out a bull thesis for other stocks. However, in this case we think it paints a very different story. When considering the valuation of Plug Power, we note a current enterprise value of $16.1 billion, being a $16.8 billion market cap, deducting $1.3 billion cash and adding $0.6 billion in debt. This gives us a forward looking EV/Sales figure for the next twelve months of 36.\nWhile the multiple itself is high by most gauges, as we’ve outlined, the number itself is not really our primary concern. If we delve a little deeper into the valuation story, what we can see is a company that traded at 3.8 times its next twelve-month revenues in September 2019 (using the same metrics outlined above). This multiple increased gradually to 12.3 by June 2020, before exploding as high as 56 times next twelve-month sales in December 2020.\nThis incredible volatility in valuation multiple does not appear to have been triggered by developing sales or profitability. PLUG's quarter-on-quarter last twelve-month sales increased a modest 50% between September 2019 and September 2020 ($198 million September 2019 and $308 million September 2020). Thereafter a large decline, caused by their accounting irregularities, led to a December 2020 loss of $94 million.\nIt's our thesis that the stock price surge was not built on any solid financial foundation, more likely linked to investor appetite for exposure to companies that may benefit from future environmental trends, and potentially the strong forecasts from management. As the projections have not yet played out in the numbers, the share price has suffered and this is a trend we expect to continue to see.\nOne positive case that can be made for PLUG's future from a valuation perspective is that despite negatively trending income statement features, the company appears to have a strong balance sheet. The considerable cash and cash equivalent balance ($1.3 billion) by far surpasses their current and long-term liabilities ($784 million), meaning PLUG should have no issues in withstanding short-term poor performance.\n(Source: PLUG's 2020 Annual report)\nThe company's current ratio of 7.21, being current assets divided by current liabilities, suggests a company more than able to continue operations despite being in a loss-making position.While this is encouraging from a bull thesis perspective, our core investment strategy is more revenue and growth orientated. PLUG certainly appears to be well capitalized, yet that alone will not enable the company to drive returns for investors. One obvious option for PLUG would be to deploy their cash into projects that would develop new revenue streams and enhance their earnings position.\nConsideration of growth opportunities\nSince we deviated from our normal order of assessment, let’s now return to where the thesis normally begins, that is the story of the company itself. Do we consider this investment story to paint a positive picture of future growth, with products that will change the company fortunes and lead to a prosperous future? If we’re honest, right now, no. Let’s assess why that is the case.\nFirstly, PLUG is a producer of hydrogen powered fuel cell solutions, outlining in their recent annual report that they see their products in “material handling vehicles and industrial trucks.\" This is the first factor that investors should be acutely aware of. The hype of 2020 may have gotten some investors carried away with this “battery producer” for electric vehicles, without understanding its position in the market.\nThe vehicle battery market is well laid out by this IHS Markit report, which considers the future prospects for hydrogen fuel cells. If you’re bullish on PLUG, this report will give some encouragement, showing that there is a strong increase expected in both vehicles and charging stations in the coming years.\n(Source:IHS Markit)\nHowever, it’s not the headline numbers that caught our eye in this report, but the description of where exactly hydrogen-powered batteries sit within the marketplace. According to the report, while there are clear benefits of hydrogen over the lithium batteries used by Tesla and others, the downside is that they use “more complex processes” and have “about half the wheel to wheel efficiency of battery electric,” concluding that they are more suitable for vehicles with heavier weights and longer trip times – think industrial vehicles and buses.\nIn our consideration of the story, this dramatically reduces the total addressable market (\"TAM\"). Yes, there are a lot of industrial vehicles in the world, but there is a significantly larger market for standard lighter automobiles, boats, light-aircraft and drones.\nOur assessment of the story is enhanced further by reporting from the International Energy Agency, who lay out their future projections for electric light duty vehicles (“LDV”) in the graph below – electric cars essentially. With projections for up to 200 million units expected to be on the road in 2030, up from 22 million today. In our opinion, if investing in the clean and green future of electric vehicles, the LDV space is far more appealing, and the smaller TAM in the hydrogen fuel cell space is a concern to the company's long-term prospects.\n(Source :IEA 2021 Report)\nThe contrary thesis for PLUG\nWe should also consider the counter argument to our thesis on the PLUG story. The bulls will be screaming that despite the smaller market, many companies have been highly profitable while cornering a certain segment of a larger market. That would undoubtedly be a fair assessment to make overall; however, do we consider that PLUG is best placed to do so?\nIn the heavy duty vehicle and hydrogen power market, there are already firms such as Proterra (PTRA), who have proof of concept and regular sales in electric buses. Plus it has become apparent that heavyweight competitors are entering the space, with General Motors' (GM )plans to supply fuel cells for locomotive trains. With this in mind, it is difficult to see PLUG capturing a significant portion of the smaller TAM that we defined earlier. Our thesis is that they may get squeezed out by this competition in the longer term.\nThat being said, the company management clearly forecasts a bright future. Their impressive September 2020 slide deck highlights their forecasts of an incredible surge in revenue growth to $1.2 billion in annual sales and $250 billion in operating EBITDA. This impressive growth will be fuelled by expansion of their existing operations and development of new market segments, such as hydrogen power plants, refueling stations, heavy duty electric vehicles, airplanes and even a \"gigafactory.\"\nThe coining of a phrase synonymous with Tesla, via their gigafactory plans, may have whet the appetite of some investors. However, we are firmly in the let’s wait and see camp here. Firstly, on the revenue side, even excluding the 2020 annual loss and writing off to the restatement issues mentioned earlier, it’s hard to gather where the $1 billion figure comes from. That would be an approximate 6.5-fold increase on the 2019 annual revenues ($150 million) in a two and a half year period; pretty ambitious? Not quite as ambitious as doing so while increasing EBITDA to $250 million from a historic loss-making position, while presumably also increasing capital expenditure to fund their gigafactory, hydrogen plant, plane and truck expansions? Unfortunately, we are struggling to see the math.\nOur conclusions on Plug Power\nIn a global environment currently shifting toward a greener and cleaner world, fuelled by more carbon efficient vehicles, it is no surprise that investors have high hopes for a stock such as PLUG. It is easy to read their marketing material and fall in love with the story and the projections. It's encouraging to see the bold plans that management have for the company; however, we would like to see more results before assuming that these can be executed.\nFrom the research we have undertaken, we believe that the total addressable market for PLUG is smaller than currently perceived by the bulls. Long-term trends suggest that lithium batteries will be the clear leader in fuelling our greener future and we believe the hydrogen market will be considerably smaller, impacting PLUG's ability to grow. When considering this, alongside the strong competition within their subsector, the accounting and litigation red flags we noted earlier, we believe that PLUG may continue to see multiple contraction and a reduction in market cap - hence our bearish outlook at this point in time.","news_type":1},"isVote":1,"tweetType":1,"viewCount":430,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":167290865,"gmtCreate":1624268624857,"gmtModify":1634008654745,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"Interesting","listText":"Interesting","text":"Interesting","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":0,"repostSize":0,"link":"https://laohu8.com/post/167290865","repostId":"1154249454","repostType":4,"isVote":1,"tweetType":1,"viewCount":547,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":166104202,"gmtCreate":1623994816306,"gmtModify":1634024396428,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"Nice","listText":"Nice","text":"Nice","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://laohu8.com/post/166104202","repostId":"2144742925","repostType":4,"isVote":1,"tweetType":1,"viewCount":995,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":166105493,"gmtCreate":1623994786012,"gmtModify":1634024397148,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"BABA","listText":"BABA","text":"BABA","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":1,"repostSize":0,"link":"https://laohu8.com/post/166105493","repostId":"1175693382","repostType":4,"repost":{"id":"1175693382","kind":"news","pubTimestamp":1623978463,"share":"https://www.laohu8.com/m/news/1175693382?lang=&edition=full","pubTime":"2021-06-18 09:07","market":"hk","language":"en","title":"Alibaba Stock: The Bottoming Process Looks To Be Forming Already","url":"https://stock-news.laohu8.com/highlight/detail?id=1175693382","media":"seekingalpha","summary":"Alibaba is probably the most undervalued growth stock right now.The company’s multiple growth drivers within a rapidly expanding market made its valuations look even more baffling.The short term technical picture may be turning bullish with a potential double bottom price action signal.When we take things into clearer perspective by comparing China’s growth rate and size of its market to that of the U.S. e-commerce market, we could see the huge differences in their sizes and growth rates as the ","content":"<p><b>Summary</b></p>\n<ul>\n <li>Alibaba is probably the most undervalued growth stock right now.</li>\n <li>The company’s multiple growth drivers within a rapidly expanding market made its valuations look even more baffling.</li>\n <li>The short term technical picture may be turning bullish with a potential double bottom price action signal.</li>\n <li>We discuss the company’s multiple growth drivers and let investors judge for themselves.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/05e63c77d4f3f3dc3d618e43044638bb\" tg-width=\"768\" tg-height=\"512\"><span>Yongyuan Dai/iStock Unreleased via Getty Images</span></p>\n<p><b>The Technical Thesis</b></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/7febf6ed056b0e3bc038321cdaad9b1c\" tg-width=\"1280\" tg-height=\"782\"><span>Source: TradingView</span></p>\n<p>Alibaba’s&nbsp;stock price has endured a terrible 8 months ever since its Ant Financial IPO was pulled in early Nov 20, with the stock languishing in the doldrums 34% off its high. When considering the health of its long term uptrend, it’s clear that BABA has a relatively strong uptrend bias and has generally been well supported along its key 50W MA. The only other time in the last 4 years that it lost its key 50W MA support level was during the 2018 bear market where BABA dropped about 40%, but was still well supported above the important 200W MA, which we usually consider as the “last line of defense”. Right now BABA is somewhat facing a similar situation again: down 34%, lost the 50W MA, but looks to be well supported above the 200W MA. In addition to that, one interesting observation in price action analysis may lead price action traders/investors to be especially bullish: a potential double bottom formation. BABA's price is seemingly going through a double bottom like it did during the 2018 bear market before it rallied strongly thereafter. As a result, BABA’s current level may offer a possible technical buy entry point now.</p>\n<p><b>BABA's Fundamental Thesis: Rapidly Expanding Growth Drivers</b></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/eba49f5881708929949c30628eedc5d4\" tg-width=\"934\" tg-height=\"578\"><span>Annual GMV. Data source: Company filings</span></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a4d6c4ed3e2402f5af52b2dea8bab411\" tg-width=\"836\" tg-height=\"517\"><span>Annual e-commerce revenue. Data source: Company filings</span></p>\n<p>BABA’s GMV grew from 1.68T yuan to 7.49T yuan in just a matter of 7 years, which represented a CAGR of 23.8%, a truly amazing growth rate. We also saw its GMV growth being converted into revenue growth as its China commerce revenue grew from 7.67B yuan to 473.68B yuan, at a CAGR of 51% over the last 10 years. While its international footprint remains considerably smaller, it still grew at a CAGR of 30.42% over the last 10 years, which was by no means slow.</p>\n<p>Even though China’s e-commerce market is expected to grow considerably slower at a CAGR of 12.4% over the next three years, from 13.8T yuan, equivalent to $2.16T in 2021 to 19.6T yuan,equivalent to $3.06T by 2024, the massive size of the market still offers tremendous upside potential for BABA and its closest competitors to grow into.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/ffe2dee43f267e1d1399c68e3ca60f36\" tg-width=\"600\" tg-height=\"371\"><span>E-commerce revenue in the U.S. Data source: Statista</span></p>\n<p>When we take things into clearer perspective by comparing China’s growth rate and size of its market to that of the U.S. e-commerce market, we could see the huge differences in their sizes and growth rates as the U.S. e-commerce market is only expected to grow at a CAGR of 4.67% from 2021 to 2025, which is significantly slower than China’s 12.4%. In addition, the U.S. market is also expected to reach about $563B in total revenue, which is 18% of what the China market is expected to be worth by then.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0d5a8d0d8a6a2dcdf667a6f33c6c9771\" tg-width=\"1280\" tg-height=\"702\"><span>Peers EBIT Margin and Projected EBIT Margin. Data source: S&amp;P Capital IQ</span></p>\n<p>Even though Alibaba has been facing increased competitive pressures from its fast growing key competitors: JD.com(NASDAQ:JD)and Pinduoduo(NASDAQ:PDD), BABA has already been operating a much more profitable business (both EBIT and FCF), and is expected to continue delivering strong profitability moving forward, which should give the company tremendous flexibility to compete head on with JD and PDD in its quest to extend its leadership. Investors may observe that BABA’s EBIT margin was affected by the one-off administrative penalty of $2,782M that was reflected in its SG&amp;A, and therefore skewed its EBIT margin to the downside.</p>\n<p>One important move was the company’s decision to further its investment in the Community Marketplace, which is PDD’s main e-commerce strategy that saw PDD gain a total of&nbsp;823M AAC&nbsp;in its latest quarter as compared to BABA’s 891M AAC. PDD’s AAC growth is truly phenomenal considering it had only&nbsp;100M AAC in Q2’C17&nbsp;as compared to BABA’s 466M AAC in the same period.</p>\n<p>Therefore, the momentum of growth has surely swung over to the Community Marketplace segment and BABA would need to pull out its big guns (which it has) to compete for dominance with PDD and JD.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/3b83b69b08b1f4b11a26393c8e6eead5\" tg-width=\"600\" tg-height=\"371\"><span>Market size of community group buying in China. Data source: iiMedia Research</span></p>\n<p>Even though the expected total market size of 102B yuan by 2022 represented only about 21.5% of BABA’s FY 21 China commerce revenue, the expected rapid CAGR of 44.22% over 3 years from 2019 to 2022 cannot be missed by BABA. Although the market is still relatively small, BABA cannot allow the current leader in this market: PDD to so easily dominate and gobble up the early high growth rates at the ignorance of everyone else. Certainly BABA must compete and fight for its place in this segment and strive for early leadership to prevent PDD from extending its lead.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/b97b2b4a8a182dc9846d8fb7e4039877\" tg-width=\"1280\" tg-height=\"770\"><span>PDD profitability metrics &amp; revenue growth forecast. Data source: S&amp;P Capital IQ</span></p>\n<p>We could observe from the above chart that PDD is expected to continue growing its revenue rapidly over the next few years, even though they are expected to normalize subsequently. More importantly, PDD is also expected to increasingly improve its EBIT and FCF profitability moving forward. This shows that the Community Marketplace segment is an highly important growth driver that BABA must use its strength to exploit in order to deny PDD’s claim to undisputed leadership so early on in the game.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/3aadc32155b4108426a1a982e3b5b1c2\" tg-width=\"640\" tg-height=\"360\"><span>China public cloud spending. Source:China Internet Watch; Canalys</span></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/1c1538b9f7bdc8d6d35a72d9acf8ecbc\" tg-width=\"600\" tg-height=\"371\"><span>Size of China public cloud market. Data source: CAICT; Sina.com.cn</span></p>\n<p>BABA has a 40% share in China’s public cloud market, way ahead of its key competitors. However, it’s important to note that despite this leadership, BABA is still in heavy investment mode to continue growing its market share as China’s public cloud market is expected to grow from 26.48B yuan in 2017 to 230.74B yuan by 2023, which would represent a CAGR of 43.4%, an incredibly stellar growth rate. This is especially clear when we compare China’s growth rate to the worldwide growth rate (see below) as public cloud spending worldwide is expected to grow from $145B in 2017 to $397B by 2022, that would represent a CAGR of 22.3%.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/06198c569504bc303c34563041dfb294\" tg-width=\"600\" tg-height=\"371\"><span>Worldwide public cloud spending. Data source: Gartner</span></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/8482037f60575f964053ab732496bee3\" tg-width=\"1176\" tg-height=\"700\"><span>Worldwide public cloud market share. Source:CnTechPost; Gartner</span></p>\n<p>Therefore, I don’t find it surprising that Ali Cloud has continued to extend its lead over Alphabet’s(NASDAQ:GOOGL)(NASDAQ:GOOG)GCP with a market share of 9.5% in 2020. While AMZN remains the clear leader in the market, its market share has been coming down considerably as public cloud spending continues to expand, indicating that there is a huge potential for growth for multiple players to exist. With BABA’s leadership in the rapidly expanding Chinese market, I’m increasingly bullish on the future profit and FCF contribution from this segment to BABA’s performance over time. Although BABA’s cloud segment has not been EBIT profitable yet (FY 21 EBIT margin: -15%, FY 20 EBIT margin: -17.5%), it’s also useful to note that GCP has also not been profitable for Alphabet as well (FY 20 EBIT margin: -42.9%, FY 19 EBIT margin: -52%). Therefore, we need to give BABA some time to scale up its cloud services in APAC and in China where it is expected to have stronger leadership to allow it to grow faster and investors should expect this to be a highly profitable segment over time.</p>\n<p><b>BABA's Valuations Look Highly Compelling</b></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/62a087c4b3ef7efc2c5dde813e3b959d\" tg-width=\"1000\" tg-height=\"600\"><span>NTM TEV / EBIT 3Y range.</span></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/b2605c0e5ad364a7a43929fef204595c\" tg-width=\"1280\" tg-height=\"687\"><span>EV / Fwd EBIT and EV / Fwd Rev trend. Data source: S&amp;P Capital IQ</span></p>\n<p>When we consider BABA's TEV / EBIT historical range, where the 3Y mean read 33.54x, BABA’s EV / Fwd EBIT trend certainly imply a hugely undervalued stock as BABA is still expected to grow its revenue and operating profits rapidly. However, as we wanted to obtain greater clarity over how its counterparts are also valued, we thought it would be useful if we value BABA’s EBIT over a set of benchmark companies that is presented below.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/d27873e676dfb23c98d4a69aa5861e02\" tg-width=\"1280\" tg-height=\"1117\"><span>Peers EV / EBIT Valuations. Data source: S&amp;P Capital IQ</span></p>\n<p>By using a blend of historical and forward EBIT, we could see that BABA’s EV / EBIT really looks undervalued when compared to the median value of the set of observed values from the benchmark companies. We derived a fair value range for BABA of $294.98 at the midpoint of the range, that represented a potential upside of 40.5% based on the current stock price of $210.</p>\n<p><b>Risks to Assumptions</b></p>\n<p>Now, it’s obviously baffling to watch how Mr. Market has decided to discount BABA to such an extent as if the company has lost all its key sources of growth, when in fact there is still so much potential upside coming from its commerce segment, the new marketplace initiatives and its growing Ali Cloud segment, among others. The main realistic reason that we identified for the stock's underperformance would simply be regulatory risk. We think investors should acknowledge that this risk is very real and at times huge Chinese companies have found themselves to be subjected to extra scrutiny (which is nothing new in fact) by the Chinese government. What’s critical here is that the Chinese government seemingly has significant clout over the behavior and actions of their tech behemoths that at times may be largely unpredictable. The market certainly hates unpredictability and therefore they may have significantly discounted BABA as a result of that. If investors are not able to handle uncertainty with regard to potentially unpredictable regulatory actions and their aftermath, then BABA may not be appropriate for you. However, if you believe that this is just a blip in BABA’s long journey, then you would surely find BABA's valuations extremely attractive right now, coupled with a long term mindset.</p>\n<p><b>Wrapping It All Up</b></p>\n<p>Alibaba has continued to deliver solid results that demonstrated the strong capability of the company to execute well. As the company continues to operate within a market with so many growth drivers that are expected to drive the company’s future growth, investors should find the current valuations highly attractive.</p>","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Alibaba Stock: The Bottoming Process Looks To Be Forming Already</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nAlibaba Stock: The Bottoming Process Looks To Be Forming Already\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-06-18 09:07 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4435297-alibaba-stock-bottoming-process-forming-buy-now><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nAlibaba is probably the most undervalued growth stock right now.\nThe company’s multiple growth drivers within a rapidly expanding market made its valuations look even more baffling.\nThe short...</p>\n\n<a href=\"https://seekingalpha.com/article/4435297-alibaba-stock-bottoming-process-forming-buy-now\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{},"source_url":"https://seekingalpha.com/article/4435297-alibaba-stock-bottoming-process-forming-buy-now","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1175693382","content_text":"Summary\n\nAlibaba is probably the most undervalued growth stock right now.\nThe company’s multiple growth drivers within a rapidly expanding market made its valuations look even more baffling.\nThe short term technical picture may be turning bullish with a potential double bottom price action signal.\nWe discuss the company’s multiple growth drivers and let investors judge for themselves.\n\nYongyuan Dai/iStock Unreleased via Getty Images\nThe Technical Thesis\nSource: TradingView\nAlibaba’s stock price has endured a terrible 8 months ever since its Ant Financial IPO was pulled in early Nov 20, with the stock languishing in the doldrums 34% off its high. When considering the health of its long term uptrend, it’s clear that BABA has a relatively strong uptrend bias and has generally been well supported along its key 50W MA. The only other time in the last 4 years that it lost its key 50W MA support level was during the 2018 bear market where BABA dropped about 40%, but was still well supported above the important 200W MA, which we usually consider as the “last line of defense”. Right now BABA is somewhat facing a similar situation again: down 34%, lost the 50W MA, but looks to be well supported above the 200W MA. In addition to that, one interesting observation in price action analysis may lead price action traders/investors to be especially bullish: a potential double bottom formation. BABA's price is seemingly going through a double bottom like it did during the 2018 bear market before it rallied strongly thereafter. As a result, BABA’s current level may offer a possible technical buy entry point now.\nBABA's Fundamental Thesis: Rapidly Expanding Growth Drivers\nAnnual GMV. Data source: Company filings\nAnnual e-commerce revenue. Data source: Company filings\nBABA’s GMV grew from 1.68T yuan to 7.49T yuan in just a matter of 7 years, which represented a CAGR of 23.8%, a truly amazing growth rate. We also saw its GMV growth being converted into revenue growth as its China commerce revenue grew from 7.67B yuan to 473.68B yuan, at a CAGR of 51% over the last 10 years. While its international footprint remains considerably smaller, it still grew at a CAGR of 30.42% over the last 10 years, which was by no means slow.\nEven though China’s e-commerce market is expected to grow considerably slower at a CAGR of 12.4% over the next three years, from 13.8T yuan, equivalent to $2.16T in 2021 to 19.6T yuan,equivalent to $3.06T by 2024, the massive size of the market still offers tremendous upside potential for BABA and its closest competitors to grow into.\nE-commerce revenue in the U.S. Data source: Statista\nWhen we take things into clearer perspective by comparing China’s growth rate and size of its market to that of the U.S. e-commerce market, we could see the huge differences in their sizes and growth rates as the U.S. e-commerce market is only expected to grow at a CAGR of 4.67% from 2021 to 2025, which is significantly slower than China’s 12.4%. In addition, the U.S. market is also expected to reach about $563B in total revenue, which is 18% of what the China market is expected to be worth by then.\nPeers EBIT Margin and Projected EBIT Margin. Data source: S&P Capital IQ\nEven though Alibaba has been facing increased competitive pressures from its fast growing key competitors: JD.com(NASDAQ:JD)and Pinduoduo(NASDAQ:PDD), BABA has already been operating a much more profitable business (both EBIT and FCF), and is expected to continue delivering strong profitability moving forward, which should give the company tremendous flexibility to compete head on with JD and PDD in its quest to extend its leadership. Investors may observe that BABA’s EBIT margin was affected by the one-off administrative penalty of $2,782M that was reflected in its SG&A, and therefore skewed its EBIT margin to the downside.\nOne important move was the company’s decision to further its investment in the Community Marketplace, which is PDD’s main e-commerce strategy that saw PDD gain a total of 823M AAC in its latest quarter as compared to BABA’s 891M AAC. PDD’s AAC growth is truly phenomenal considering it had only 100M AAC in Q2’C17 as compared to BABA’s 466M AAC in the same period.\nTherefore, the momentum of growth has surely swung over to the Community Marketplace segment and BABA would need to pull out its big guns (which it has) to compete for dominance with PDD and JD.\nMarket size of community group buying in China. Data source: iiMedia Research\nEven though the expected total market size of 102B yuan by 2022 represented only about 21.5% of BABA’s FY 21 China commerce revenue, the expected rapid CAGR of 44.22% over 3 years from 2019 to 2022 cannot be missed by BABA. Although the market is still relatively small, BABA cannot allow the current leader in this market: PDD to so easily dominate and gobble up the early high growth rates at the ignorance of everyone else. Certainly BABA must compete and fight for its place in this segment and strive for early leadership to prevent PDD from extending its lead.\nPDD profitability metrics & revenue growth forecast. Data source: S&P Capital IQ\nWe could observe from the above chart that PDD is expected to continue growing its revenue rapidly over the next few years, even though they are expected to normalize subsequently. More importantly, PDD is also expected to increasingly improve its EBIT and FCF profitability moving forward. This shows that the Community Marketplace segment is an highly important growth driver that BABA must use its strength to exploit in order to deny PDD’s claim to undisputed leadership so early on in the game.\nChina public cloud spending. Source:China Internet Watch; Canalys\nSize of China public cloud market. Data source: CAICT; Sina.com.cn\nBABA has a 40% share in China’s public cloud market, way ahead of its key competitors. However, it’s important to note that despite this leadership, BABA is still in heavy investment mode to continue growing its market share as China’s public cloud market is expected to grow from 26.48B yuan in 2017 to 230.74B yuan by 2023, which would represent a CAGR of 43.4%, an incredibly stellar growth rate. This is especially clear when we compare China’s growth rate to the worldwide growth rate (see below) as public cloud spending worldwide is expected to grow from $145B in 2017 to $397B by 2022, that would represent a CAGR of 22.3%.\nWorldwide public cloud spending. Data source: Gartner\nWorldwide public cloud market share. Source:CnTechPost; Gartner\nTherefore, I don’t find it surprising that Ali Cloud has continued to extend its lead over Alphabet’s(NASDAQ:GOOGL)(NASDAQ:GOOG)GCP with a market share of 9.5% in 2020. While AMZN remains the clear leader in the market, its market share has been coming down considerably as public cloud spending continues to expand, indicating that there is a huge potential for growth for multiple players to exist. With BABA’s leadership in the rapidly expanding Chinese market, I’m increasingly bullish on the future profit and FCF contribution from this segment to BABA’s performance over time. Although BABA’s cloud segment has not been EBIT profitable yet (FY 21 EBIT margin: -15%, FY 20 EBIT margin: -17.5%), it’s also useful to note that GCP has also not been profitable for Alphabet as well (FY 20 EBIT margin: -42.9%, FY 19 EBIT margin: -52%). Therefore, we need to give BABA some time to scale up its cloud services in APAC and in China where it is expected to have stronger leadership to allow it to grow faster and investors should expect this to be a highly profitable segment over time.\nBABA's Valuations Look Highly Compelling\nNTM TEV / EBIT 3Y range.\nEV / Fwd EBIT and EV / Fwd Rev trend. Data source: S&P Capital IQ\nWhen we consider BABA's TEV / EBIT historical range, where the 3Y mean read 33.54x, BABA’s EV / Fwd EBIT trend certainly imply a hugely undervalued stock as BABA is still expected to grow its revenue and operating profits rapidly. However, as we wanted to obtain greater clarity over how its counterparts are also valued, we thought it would be useful if we value BABA’s EBIT over a set of benchmark companies that is presented below.\nPeers EV / EBIT Valuations. Data source: S&P Capital IQ\nBy using a blend of historical and forward EBIT, we could see that BABA’s EV / EBIT really looks undervalued when compared to the median value of the set of observed values from the benchmark companies. We derived a fair value range for BABA of $294.98 at the midpoint of the range, that represented a potential upside of 40.5% based on the current stock price of $210.\nRisks to Assumptions\nNow, it’s obviously baffling to watch how Mr. Market has decided to discount BABA to such an extent as if the company has lost all its key sources of growth, when in fact there is still so much potential upside coming from its commerce segment, the new marketplace initiatives and its growing Ali Cloud segment, among others. The main realistic reason that we identified for the stock's underperformance would simply be regulatory risk. We think investors should acknowledge that this risk is very real and at times huge Chinese companies have found themselves to be subjected to extra scrutiny (which is nothing new in fact) by the Chinese government. What’s critical here is that the Chinese government seemingly has significant clout over the behavior and actions of their tech behemoths that at times may be largely unpredictable. The market certainly hates unpredictability and therefore they may have significantly discounted BABA as a result of that. If investors are not able to handle uncertainty with regard to potentially unpredictable regulatory actions and their aftermath, then BABA may not be appropriate for you. However, if you believe that this is just a blip in BABA’s long journey, then you would surely find BABA's valuations extremely attractive right now, coupled with a long term mindset.\nWrapping It All Up\nAlibaba has continued to deliver solid results that demonstrated the strong capability of the company to execute well. As the company continues to operate within a market with so many growth drivers that are expected to drive the company’s future growth, investors should find the current valuations highly attractive.","news_type":1},"isVote":1,"tweetType":1,"viewCount":461,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":161335524,"gmtCreate":1623904500968,"gmtModify":1634026056192,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"Good read","listText":"Good read","text":"Good 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money","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":1,"repostSize":0,"link":"https://laohu8.com/post/169260548","repostId":"1105866425","repostType":4,"isVote":1,"tweetType":1,"viewCount":865,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0}],"hots":[{"id":161335524,"gmtCreate":1623904500968,"gmtModify":1634026056192,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"Good read","listText":"Good read","text":"Good read","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":2,"commentSize":2,"repostSize":0,"link":"https://laohu8.com/post/161335524","repostId":"2143379379","repostType":4,"isVote":1,"tweetType":1,"viewCount":586,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":121029428,"gmtCreate":1624445423464,"gmtModify":1634006070583,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"Hmm","listText":"Hmm","text":"Hmm","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":1,"repostSize":0,"link":"https://laohu8.com/post/121029428","repostId":"2145531099","repostType":4,"isVote":1,"tweetType":1,"viewCount":730,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":167297166,"gmtCreate":1624269113155,"gmtModify":1634008647977,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"Chargepoint?","listText":"Chargepoint?","text":"Chargepoint?","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":0,"repostSize":0,"link":"https://laohu8.com/post/167297166","repostId":"1196746626","repostType":4,"repost":{"id":"1196746626","kind":"news","pubTimestamp":1624268221,"share":"https://www.laohu8.com/m/news/1196746626?lang=&edition=full","pubTime":"2021-06-21 17:37","market":"us","language":"en","title":"Plug Power: This Stock Fails To Get Us Charged Up","url":"https://stock-news.laohu8.com/highlight/detail?id=1196746626","media":"seekingalpha","summary":"Summary\n\nPlug Power, the producer of hydrogen fuel cell solutions, has had a turbulent history, with","content":"<p><b>Summary</b></p>\n<ul>\n <li>Plug Power, the producer of hydrogen fuel cell solutions, has had a turbulent history, with the stock trading at just a fraction of its 1999 tech boom price.</li>\n <li>Despite experiencing a renaissance in the 2020 tech and growth surge, the stock appears to be re-rating back to its earlier valuation multiple as investor optimism falters.</li>\n <li>Management has high hopes for the future, with an impressive slide-deck published in the fall of 2020 laying out how they see the company developing in the near future.</li>\n <li>While forecasts are impressive to read, investors should consider whether there is enough substance in the numbers to back them up.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/cd52b10176701b73dd7d557921bfd29e\" tg-width=\"768\" tg-height=\"480\"><span>3alexd/E+ via Getty Images</span></p>\n<p><b>Investment Thesis</b></p>\n<p>Despite a strong end to 2020, fuelled by investor optimism for all things linked to our clean and green future, this stock appears to be re-rating back to its former valuation multiple.While there are many factors investors will point towards to support a bull thesis, in our opinion many forward-looking projections are overly ambitious and may ultimately be out of reach. We question whether the total addressable market is significant enough for Plug to prosper, particularly in the light of strong competition.</p>\n<p><b>The Background to our thesis</b></p>\n<p>Plug Power (PLUG) was a roaring success in the latter part of 2020, increasing by over 400% to its January 2021 peak, before crashing back down to earth as the stock was hit by an&nbsp;accounting scandal.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/7c03000d0db7000dd850fad52fdd9068\" tg-width=\"635\" tg-height=\"403\"><span>Data by YCharts</span></p>\n<p>The accounting issues have been covered in detail in the article linked above, so we won’t pore over them in too much detail here, except to say we are big believers in the old adage - “if in doubt, get out.\" An accounting scandal and a restatement of prior year figures is perhaps not the wisest foundations with which to build an investment decision in our opinion.</p>\n<p>Whether an accounting scandal is considered a red flag from an investment thesis or not, most investors would baulk at the thought of investing in a firm with legal concerns and unknown liabilities. Unfortunately, for PLUG stockholders, that is exactly what is laid out in the company’s most recent&nbsp;annual report, with a flurry of legal proceedings being filed in early 2021 off the back of the accounting scandal, adding to earlier proceedings from staff involved in an accident which is yet to be resolved. For many investors, these flags would be enough to deter them from an investment. However, a contrary argument may be that these factors are already priced in and the company's future may be rosier. Let's consider what the future holds for Plug Power.</p>\n<p><b>Considering Plug Power's Valuation</b></p>\n<p>As long-term growth investors, the consideration of valuation is not normally the first port of call when considering an investment decision. We’ve previously laid out our belief that what seems expensive, often is so for good reason, when laying out a bull thesis for other stocks. However, in this case we think it paints a very different story. When considering the valuation of Plug Power, we note a current enterprise value of $16.1 billion, being a $16.8 billion market cap, deducting $1.3 billion cash and adding $0.6 billion in debt. This gives us a forward looking EV/Sales figure for the next twelve months of 36.</p>\n<p>While the multiple itself is high by most gauges, as we’ve outlined, the number itself is not really our primary concern. If we delve a little deeper into the valuation story, what we can see is a company that traded at 3.8 times its next twelve-month revenues in September 2019 (using the same metrics outlined above). This multiple increased gradually to 12.3 by June 2020, before exploding as high as 56 times next twelve-month sales in December 2020.</p>\n<p>This incredible volatility in valuation multiple does not appear to have been triggered by developing sales or profitability. PLUG's quarter-on-quarter last twelve-month sales increased a modest 50% between September 2019 and September 2020 ($198 million September 2019 and $308 million September 2020). Thereafter a large decline, caused by their accounting irregularities, led to a December 2020 loss of $94 million.</p>\n<p>It's our thesis that the stock price surge was not built on any solid financial foundation, more likely linked to investor appetite for exposure to companies that may benefit from future environmental trends, and potentially the strong forecasts from management. As the projections have not yet played out in the numbers, the share price has suffered and this is a trend we expect to continue to see.</p>\n<p>One positive case that can be made for PLUG's future from a valuation perspective is that despite negatively trending income statement features, the company appears to have a strong balance sheet. The considerable cash and cash equivalent balance ($1.3 billion) by far surpasses their current and long-term liabilities ($784 million), meaning PLUG should have no issues in withstanding short-term poor performance.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a02d2db1e6065bc1e3501e02da38a16a\" tg-width=\"624\" tg-height=\"229\"><span>(Source: PLUG's 2020 Annual report)</span></p>\n<p>The company's current ratio of 7.21, being current assets divided by current liabilities, suggests a company more than able to continue operations despite being in a loss-making position.While this is encouraging from a bull thesis perspective, our core investment strategy is more revenue and growth orientated. PLUG certainly appears to be well capitalized, yet that alone will not enable the company to drive returns for investors. One obvious option for PLUG would be to deploy their cash into projects that would develop new revenue streams and enhance their earnings position.</p>\n<p><b>Consideration of growth opportunities</b></p>\n<p>Since we deviated from our normal order of assessment, let’s now return to where the thesis normally begins, that is the story of the company itself. Do we consider this investment story to paint a positive picture of future growth, with products that will change the company fortunes and lead to a prosperous future? If we’re honest, right now, no. Let’s assess why that is the case.</p>\n<p>Firstly, PLUG is a producer of hydrogen powered fuel cell solutions, outlining in their recent&nbsp;annual report&nbsp;that they see their products in “material handling vehicles and industrial trucks.\" This is the first factor that investors should be acutely aware of. The hype of 2020 may have gotten some investors carried away with this “battery producer” for electric vehicles, without understanding its position in the market.</p>\n<p>The vehicle battery market is well laid out by this&nbsp;IHS Markit report, which considers the future prospects for hydrogen fuel cells. If you’re bullish on PLUG, this report will give some encouragement, showing that there is a strong increase expected in both vehicles and charging stations in the coming years.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/c627200e94e6301508a5f09d5381a43b\" tg-width=\"640\" tg-height=\"251\"><span>(Source:IHS Markit)</span></p>\n<p>However, it’s not the headline numbers that caught our eye in this report, but the description of where exactly hydrogen-powered batteries sit within the marketplace. According to the report, while there are clear benefits of hydrogen over the lithium batteries used by Tesla and others, the downside is that they use “more complex processes” and have “about half the wheel to wheel efficiency of battery electric,” concluding that they are more suitable for vehicles with heavier weights and longer trip times – think industrial vehicles and buses.</p>\n<p>In our consideration of the story, this dramatically reduces the total addressable market (\"TAM\"). Yes, there are a lot of industrial vehicles in the world, but there is a significantly larger market for standard lighter automobiles, boats, light-aircraft and drones.</p>\n<p>Our assessment of the story is enhanced further by reporting from the International Energy Agency, who lay out their future projections for electric light duty vehicles (“LDV”) in the graph below – electric cars essentially. With projections for up to 200 million units expected to be on the road in 2030, up from 22 million today. In our opinion, if investing in the clean and green future of electric vehicles, the LDV space is far more appealing, and the smaller TAM in the hydrogen fuel cell space is a concern to the company's long-term prospects.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/59bfbab3f6732c318b381f6832adfd3d\" tg-width=\"640\" tg-height=\"342\"><span>(Source :IEA 2021 Report)</span></p>\n<p><b>The contrary thesis for PLUG</b></p>\n<p>We should also consider the counter argument to our thesis on the PLUG story. The bulls will be screaming that despite the smaller market, many companies have been highly profitable while cornering a certain segment of a larger market. That would undoubtedly be a fair assessment to make overall; however, do we consider that PLUG is best placed to do so?</p>\n<p>In the heavy duty vehicle and hydrogen power market, there are already firms such as Proterra (PTRA), who have proof of concept and regular sales in electric buses. Plus it has become apparent that heavyweight competitors are entering the space, with General Motors' (GM&nbsp;)plans to supply&nbsp;fuel cells for locomotive trains. With this in mind, it is difficult to see PLUG capturing a significant portion of the smaller TAM that we defined earlier. Our thesis is that they may get squeezed out by this competition in the longer term.</p>\n<p>That being said, the company management clearly forecasts a bright future. Their impressive September 2020&nbsp;slide deck&nbsp;highlights their forecasts of an incredible surge in revenue growth to $1.2 billion in annual sales and $250 billion in operating EBITDA. This impressive growth will be fuelled by expansion of their existing operations and development of new market segments, such as hydrogen power plants, refueling stations, heavy duty electric vehicles, airplanes and even a \"gigafactory.\"</p>\n<p>The coining of a phrase synonymous with Tesla, via their gigafactory plans, may have whet the appetite of some investors. However, we are firmly in the let’s wait and see camp here. Firstly, on the revenue side, even excluding the 2020 annual loss and writing off to the restatement issues mentioned earlier, it’s hard to gather where the $1 billion figure comes from. That would be an approximate 6.5-fold increase on the 2019 annual revenues ($150 million) in a two and a half year period; pretty ambitious? Not quite as ambitious as doing so while increasing EBITDA to $250 million from a historic loss-making position, while presumably also increasing capital expenditure to fund their gigafactory, hydrogen plant, plane and truck expansions? Unfortunately, we are struggling to see the math.</p>\n<p><b>Our conclusions on Plug Power</b></p>\n<p>In a global environment currently shifting toward a greener and cleaner world, fuelled by more carbon efficient vehicles, it is no surprise that investors have high hopes for a stock such as PLUG. It is easy to read their marketing material and fall in love with the story and the projections. It's encouraging to see the bold plans that management have for the company; however, we would like to see more results before assuming that these can be executed.</p>\n<p>From the research we have undertaken, we believe that the total addressable market for PLUG is smaller than currently perceived by the bulls. Long-term trends suggest that lithium batteries will be the clear leader in fuelling our greener future and we believe the hydrogen market will be considerably smaller, impacting PLUG's ability to grow. When considering this, alongside the strong competition within their subsector, the accounting and litigation red flags we noted earlier, we believe that PLUG may continue to see multiple contraction and a reduction in market cap - hence our bearish outlook at this point in time.</p>","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Plug Power: This Stock Fails To Get Us Charged Up</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; 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}\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nPlug Power: This Stock Fails To Get Us Charged Up\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-06-21 17:37 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4435786-plug-power-this-stock-fails-to-get-us-charged-up><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nPlug Power, the producer of hydrogen fuel cell solutions, has had a turbulent history, with the stock trading at just a fraction of its 1999 tech boom price.\nDespite experiencing a ...</p>\n\n<a href=\"https://seekingalpha.com/article/4435786-plug-power-this-stock-fails-to-get-us-charged-up\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"PLUG":"普拉格能源"},"source_url":"https://seekingalpha.com/article/4435786-plug-power-this-stock-fails-to-get-us-charged-up","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1196746626","content_text":"Summary\n\nPlug Power, the producer of hydrogen fuel cell solutions, has had a turbulent history, with the stock trading at just a fraction of its 1999 tech boom price.\nDespite experiencing a renaissance in the 2020 tech and growth surge, the stock appears to be re-rating back to its earlier valuation multiple as investor optimism falters.\nManagement has high hopes for the future, with an impressive slide-deck published in the fall of 2020 laying out how they see the company developing in the near future.\nWhile forecasts are impressive to read, investors should consider whether there is enough substance in the numbers to back them up.\n\n3alexd/E+ via Getty Images\nInvestment Thesis\nDespite a strong end to 2020, fuelled by investor optimism for all things linked to our clean and green future, this stock appears to be re-rating back to its former valuation multiple.While there are many factors investors will point towards to support a bull thesis, in our opinion many forward-looking projections are overly ambitious and may ultimately be out of reach. We question whether the total addressable market is significant enough for Plug to prosper, particularly in the light of strong competition.\nThe Background to our thesis\nPlug Power (PLUG) was a roaring success in the latter part of 2020, increasing by over 400% to its January 2021 peak, before crashing back down to earth as the stock was hit by an accounting scandal.\nData by YCharts\nThe accounting issues have been covered in detail in the article linked above, so we won’t pore over them in too much detail here, except to say we are big believers in the old adage - “if in doubt, get out.\" An accounting scandal and a restatement of prior year figures is perhaps not the wisest foundations with which to build an investment decision in our opinion.\nWhether an accounting scandal is considered a red flag from an investment thesis or not, most investors would baulk at the thought of investing in a firm with legal concerns and unknown liabilities. Unfortunately, for PLUG stockholders, that is exactly what is laid out in the company’s most recent annual report, with a flurry of legal proceedings being filed in early 2021 off the back of the accounting scandal, adding to earlier proceedings from staff involved in an accident which is yet to be resolved. For many investors, these flags would be enough to deter them from an investment. However, a contrary argument may be that these factors are already priced in and the company's future may be rosier. Let's consider what the future holds for Plug Power.\nConsidering Plug Power's Valuation\nAs long-term growth investors, the consideration of valuation is not normally the first port of call when considering an investment decision. We’ve previously laid out our belief that what seems expensive, often is so for good reason, when laying out a bull thesis for other stocks. However, in this case we think it paints a very different story. When considering the valuation of Plug Power, we note a current enterprise value of $16.1 billion, being a $16.8 billion market cap, deducting $1.3 billion cash and adding $0.6 billion in debt. This gives us a forward looking EV/Sales figure for the next twelve months of 36.\nWhile the multiple itself is high by most gauges, as we’ve outlined, the number itself is not really our primary concern. If we delve a little deeper into the valuation story, what we can see is a company that traded at 3.8 times its next twelve-month revenues in September 2019 (using the same metrics outlined above). This multiple increased gradually to 12.3 by June 2020, before exploding as high as 56 times next twelve-month sales in December 2020.\nThis incredible volatility in valuation multiple does not appear to have been triggered by developing sales or profitability. PLUG's quarter-on-quarter last twelve-month sales increased a modest 50% between September 2019 and September 2020 ($198 million September 2019 and $308 million September 2020). Thereafter a large decline, caused by their accounting irregularities, led to a December 2020 loss of $94 million.\nIt's our thesis that the stock price surge was not built on any solid financial foundation, more likely linked to investor appetite for exposure to companies that may benefit from future environmental trends, and potentially the strong forecasts from management. As the projections have not yet played out in the numbers, the share price has suffered and this is a trend we expect to continue to see.\nOne positive case that can be made for PLUG's future from a valuation perspective is that despite negatively trending income statement features, the company appears to have a strong balance sheet. The considerable cash and cash equivalent balance ($1.3 billion) by far surpasses their current and long-term liabilities ($784 million), meaning PLUG should have no issues in withstanding short-term poor performance.\n(Source: PLUG's 2020 Annual report)\nThe company's current ratio of 7.21, being current assets divided by current liabilities, suggests a company more than able to continue operations despite being in a loss-making position.While this is encouraging from a bull thesis perspective, our core investment strategy is more revenue and growth orientated. PLUG certainly appears to be well capitalized, yet that alone will not enable the company to drive returns for investors. One obvious option for PLUG would be to deploy their cash into projects that would develop new revenue streams and enhance their earnings position.\nConsideration of growth opportunities\nSince we deviated from our normal order of assessment, let’s now return to where the thesis normally begins, that is the story of the company itself. Do we consider this investment story to paint a positive picture of future growth, with products that will change the company fortunes and lead to a prosperous future? If we’re honest, right now, no. Let’s assess why that is the case.\nFirstly, PLUG is a producer of hydrogen powered fuel cell solutions, outlining in their recent annual report that they see their products in “material handling vehicles and industrial trucks.\" This is the first factor that investors should be acutely aware of. The hype of 2020 may have gotten some investors carried away with this “battery producer” for electric vehicles, without understanding its position in the market.\nThe vehicle battery market is well laid out by this IHS Markit report, which considers the future prospects for hydrogen fuel cells. If you’re bullish on PLUG, this report will give some encouragement, showing that there is a strong increase expected in both vehicles and charging stations in the coming years.\n(Source:IHS Markit)\nHowever, it’s not the headline numbers that caught our eye in this report, but the description of where exactly hydrogen-powered batteries sit within the marketplace. According to the report, while there are clear benefits of hydrogen over the lithium batteries used by Tesla and others, the downside is that they use “more complex processes” and have “about half the wheel to wheel efficiency of battery electric,” concluding that they are more suitable for vehicles with heavier weights and longer trip times – think industrial vehicles and buses.\nIn our consideration of the story, this dramatically reduces the total addressable market (\"TAM\"). Yes, there are a lot of industrial vehicles in the world, but there is a significantly larger market for standard lighter automobiles, boats, light-aircraft and drones.\nOur assessment of the story is enhanced further by reporting from the International Energy Agency, who lay out their future projections for electric light duty vehicles (“LDV”) in the graph below – electric cars essentially. With projections for up to 200 million units expected to be on the road in 2030, up from 22 million today. In our opinion, if investing in the clean and green future of electric vehicles, the LDV space is far more appealing, and the smaller TAM in the hydrogen fuel cell space is a concern to the company's long-term prospects.\n(Source :IEA 2021 Report)\nThe contrary thesis for PLUG\nWe should also consider the counter argument to our thesis on the PLUG story. The bulls will be screaming that despite the smaller market, many companies have been highly profitable while cornering a certain segment of a larger market. That would undoubtedly be a fair assessment to make overall; however, do we consider that PLUG is best placed to do so?\nIn the heavy duty vehicle and hydrogen power market, there are already firms such as Proterra (PTRA), who have proof of concept and regular sales in electric buses. Plus it has become apparent that heavyweight competitors are entering the space, with General Motors' (GM )plans to supply fuel cells for locomotive trains. With this in mind, it is difficult to see PLUG capturing a significant portion of the smaller TAM that we defined earlier. Our thesis is that they may get squeezed out by this competition in the longer term.\nThat being said, the company management clearly forecasts a bright future. Their impressive September 2020 slide deck highlights their forecasts of an incredible surge in revenue growth to $1.2 billion in annual sales and $250 billion in operating EBITDA. This impressive growth will be fuelled by expansion of their existing operations and development of new market segments, such as hydrogen power plants, refueling stations, heavy duty electric vehicles, airplanes and even a \"gigafactory.\"\nThe coining of a phrase synonymous with Tesla, via their gigafactory plans, may have whet the appetite of some investors. However, we are firmly in the let’s wait and see camp here. Firstly, on the revenue side, even excluding the 2020 annual loss and writing off to the restatement issues mentioned earlier, it’s hard to gather where the $1 billion figure comes from. That would be an approximate 6.5-fold increase on the 2019 annual revenues ($150 million) in a two and a half year period; pretty ambitious? Not quite as ambitious as doing so while increasing EBITDA to $250 million from a historic loss-making position, while presumably also increasing capital expenditure to fund their gigafactory, hydrogen plant, plane and truck expansions? Unfortunately, we are struggling to see the math.\nOur conclusions on Plug Power\nIn a global environment currently shifting toward a greener and cleaner world, fuelled by more carbon efficient vehicles, it is no surprise that investors have high hopes for a stock such as PLUG. It is easy to read their marketing material and fall in love with the story and the projections. It's encouraging to see the bold plans that management have for the company; however, we would like to see more results before assuming that these can be executed.\nFrom the research we have undertaken, we believe that the total addressable market for PLUG is smaller than currently perceived by the bulls. Long-term trends suggest that lithium batteries will be the clear leader in fuelling our greener future and we believe the hydrogen market will be considerably smaller, impacting PLUG's ability to grow. When considering this, alongside the strong competition within their subsector, the accounting and litigation red flags we noted earlier, we believe that PLUG may continue to see multiple contraction and a reduction in market cap - hence our bearish outlook at this point in time.","news_type":1},"isVote":1,"tweetType":1,"viewCount":430,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":167290865,"gmtCreate":1624268624857,"gmtModify":1634008654745,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"Interesting","listText":"Interesting","text":"Interesting","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":0,"repostSize":0,"link":"https://laohu8.com/post/167290865","repostId":"1154249454","repostType":4,"isVote":1,"tweetType":1,"viewCount":547,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":166105493,"gmtCreate":1623994786012,"gmtModify":1634024397148,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"BABA","listText":"BABA","text":"BABA","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":1,"repostSize":0,"link":"https://laohu8.com/post/166105493","repostId":"1175693382","repostType":4,"repost":{"id":"1175693382","kind":"news","pubTimestamp":1623978463,"share":"https://www.laohu8.com/m/news/1175693382?lang=&edition=full","pubTime":"2021-06-18 09:07","market":"hk","language":"en","title":"Alibaba Stock: The Bottoming Process Looks To Be Forming Already","url":"https://stock-news.laohu8.com/highlight/detail?id=1175693382","media":"seekingalpha","summary":"Alibaba is probably the most undervalued growth stock right now.The company’s multiple growth drivers within a rapidly expanding market made its valuations look even more baffling.The short term technical picture may be turning bullish with a potential double bottom price action signal.When we take things into clearer perspective by comparing China’s growth rate and size of its market to that of the U.S. e-commerce market, we could see the huge differences in their sizes and growth rates as the ","content":"<p><b>Summary</b></p>\n<ul>\n <li>Alibaba is probably the most undervalued growth stock right now.</li>\n <li>The company’s multiple growth drivers within a rapidly expanding market made its valuations look even more baffling.</li>\n <li>The short term technical picture may be turning bullish with a potential double bottom price action signal.</li>\n <li>We discuss the company’s multiple growth drivers and let investors judge for themselves.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/05e63c77d4f3f3dc3d618e43044638bb\" tg-width=\"768\" tg-height=\"512\"><span>Yongyuan Dai/iStock Unreleased via Getty Images</span></p>\n<p><b>The Technical Thesis</b></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/7febf6ed056b0e3bc038321cdaad9b1c\" tg-width=\"1280\" tg-height=\"782\"><span>Source: TradingView</span></p>\n<p>Alibaba’s&nbsp;stock price has endured a terrible 8 months ever since its Ant Financial IPO was pulled in early Nov 20, with the stock languishing in the doldrums 34% off its high. When considering the health of its long term uptrend, it’s clear that BABA has a relatively strong uptrend bias and has generally been well supported along its key 50W MA. The only other time in the last 4 years that it lost its key 50W MA support level was during the 2018 bear market where BABA dropped about 40%, but was still well supported above the important 200W MA, which we usually consider as the “last line of defense”. Right now BABA is somewhat facing a similar situation again: down 34%, lost the 50W MA, but looks to be well supported above the 200W MA. In addition to that, one interesting observation in price action analysis may lead price action traders/investors to be especially bullish: a potential double bottom formation. BABA's price is seemingly going through a double bottom like it did during the 2018 bear market before it rallied strongly thereafter. As a result, BABA’s current level may offer a possible technical buy entry point now.</p>\n<p><b>BABA's Fundamental Thesis: Rapidly Expanding Growth Drivers</b></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/eba49f5881708929949c30628eedc5d4\" tg-width=\"934\" tg-height=\"578\"><span>Annual GMV. Data source: Company filings</span></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a4d6c4ed3e2402f5af52b2dea8bab411\" tg-width=\"836\" tg-height=\"517\"><span>Annual e-commerce revenue. Data source: Company filings</span></p>\n<p>BABA’s GMV grew from 1.68T yuan to 7.49T yuan in just a matter of 7 years, which represented a CAGR of 23.8%, a truly amazing growth rate. We also saw its GMV growth being converted into revenue growth as its China commerce revenue grew from 7.67B yuan to 473.68B yuan, at a CAGR of 51% over the last 10 years. While its international footprint remains considerably smaller, it still grew at a CAGR of 30.42% over the last 10 years, which was by no means slow.</p>\n<p>Even though China’s e-commerce market is expected to grow considerably slower at a CAGR of 12.4% over the next three years, from 13.8T yuan, equivalent to $2.16T in 2021 to 19.6T yuan,equivalent to $3.06T by 2024, the massive size of the market still offers tremendous upside potential for BABA and its closest competitors to grow into.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/ffe2dee43f267e1d1399c68e3ca60f36\" tg-width=\"600\" tg-height=\"371\"><span>E-commerce revenue in the U.S. Data source: Statista</span></p>\n<p>When we take things into clearer perspective by comparing China’s growth rate and size of its market to that of the U.S. e-commerce market, we could see the huge differences in their sizes and growth rates as the U.S. e-commerce market is only expected to grow at a CAGR of 4.67% from 2021 to 2025, which is significantly slower than China’s 12.4%. In addition, the U.S. market is also expected to reach about $563B in total revenue, which is 18% of what the China market is expected to be worth by then.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0d5a8d0d8a6a2dcdf667a6f33c6c9771\" tg-width=\"1280\" tg-height=\"702\"><span>Peers EBIT Margin and Projected EBIT Margin. Data source: S&amp;P Capital IQ</span></p>\n<p>Even though Alibaba has been facing increased competitive pressures from its fast growing key competitors: JD.com(NASDAQ:JD)and Pinduoduo(NASDAQ:PDD), BABA has already been operating a much more profitable business (both EBIT and FCF), and is expected to continue delivering strong profitability moving forward, which should give the company tremendous flexibility to compete head on with JD and PDD in its quest to extend its leadership. Investors may observe that BABA’s EBIT margin was affected by the one-off administrative penalty of $2,782M that was reflected in its SG&amp;A, and therefore skewed its EBIT margin to the downside.</p>\n<p>One important move was the company’s decision to further its investment in the Community Marketplace, which is PDD’s main e-commerce strategy that saw PDD gain a total of&nbsp;823M AAC&nbsp;in its latest quarter as compared to BABA’s 891M AAC. PDD’s AAC growth is truly phenomenal considering it had only&nbsp;100M AAC in Q2’C17&nbsp;as compared to BABA’s 466M AAC in the same period.</p>\n<p>Therefore, the momentum of growth has surely swung over to the Community Marketplace segment and BABA would need to pull out its big guns (which it has) to compete for dominance with PDD and JD.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/3b83b69b08b1f4b11a26393c8e6eead5\" tg-width=\"600\" tg-height=\"371\"><span>Market size of community group buying in China. Data source: iiMedia Research</span></p>\n<p>Even though the expected total market size of 102B yuan by 2022 represented only about 21.5% of BABA’s FY 21 China commerce revenue, the expected rapid CAGR of 44.22% over 3 years from 2019 to 2022 cannot be missed by BABA. Although the market is still relatively small, BABA cannot allow the current leader in this market: PDD to so easily dominate and gobble up the early high growth rates at the ignorance of everyone else. Certainly BABA must compete and fight for its place in this segment and strive for early leadership to prevent PDD from extending its lead.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/b97b2b4a8a182dc9846d8fb7e4039877\" tg-width=\"1280\" tg-height=\"770\"><span>PDD profitability metrics &amp; revenue growth forecast. Data source: S&amp;P Capital IQ</span></p>\n<p>We could observe from the above chart that PDD is expected to continue growing its revenue rapidly over the next few years, even though they are expected to normalize subsequently. More importantly, PDD is also expected to increasingly improve its EBIT and FCF profitability moving forward. This shows that the Community Marketplace segment is an highly important growth driver that BABA must use its strength to exploit in order to deny PDD’s claim to undisputed leadership so early on in the game.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/3aadc32155b4108426a1a982e3b5b1c2\" tg-width=\"640\" tg-height=\"360\"><span>China public cloud spending. Source:China Internet Watch; Canalys</span></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/1c1538b9f7bdc8d6d35a72d9acf8ecbc\" tg-width=\"600\" tg-height=\"371\"><span>Size of China public cloud market. Data source: CAICT; Sina.com.cn</span></p>\n<p>BABA has a 40% share in China’s public cloud market, way ahead of its key competitors. However, it’s important to note that despite this leadership, BABA is still in heavy investment mode to continue growing its market share as China’s public cloud market is expected to grow from 26.48B yuan in 2017 to 230.74B yuan by 2023, which would represent a CAGR of 43.4%, an incredibly stellar growth rate. This is especially clear when we compare China’s growth rate to the worldwide growth rate (see below) as public cloud spending worldwide is expected to grow from $145B in 2017 to $397B by 2022, that would represent a CAGR of 22.3%.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/06198c569504bc303c34563041dfb294\" tg-width=\"600\" tg-height=\"371\"><span>Worldwide public cloud spending. Data source: Gartner</span></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/8482037f60575f964053ab732496bee3\" tg-width=\"1176\" tg-height=\"700\"><span>Worldwide public cloud market share. Source:CnTechPost; Gartner</span></p>\n<p>Therefore, I don’t find it surprising that Ali Cloud has continued to extend its lead over Alphabet’s(NASDAQ:GOOGL)(NASDAQ:GOOG)GCP with a market share of 9.5% in 2020. While AMZN remains the clear leader in the market, its market share has been coming down considerably as public cloud spending continues to expand, indicating that there is a huge potential for growth for multiple players to exist. With BABA’s leadership in the rapidly expanding Chinese market, I’m increasingly bullish on the future profit and FCF contribution from this segment to BABA’s performance over time. Although BABA’s cloud segment has not been EBIT profitable yet (FY 21 EBIT margin: -15%, FY 20 EBIT margin: -17.5%), it’s also useful to note that GCP has also not been profitable for Alphabet as well (FY 20 EBIT margin: -42.9%, FY 19 EBIT margin: -52%). Therefore, we need to give BABA some time to scale up its cloud services in APAC and in China where it is expected to have stronger leadership to allow it to grow faster and investors should expect this to be a highly profitable segment over time.</p>\n<p><b>BABA's Valuations Look Highly Compelling</b></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/62a087c4b3ef7efc2c5dde813e3b959d\" tg-width=\"1000\" tg-height=\"600\"><span>NTM TEV / EBIT 3Y range.</span></p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/b2605c0e5ad364a7a43929fef204595c\" tg-width=\"1280\" tg-height=\"687\"><span>EV / Fwd EBIT and EV / Fwd Rev trend. Data source: S&amp;P Capital IQ</span></p>\n<p>When we consider BABA's TEV / EBIT historical range, where the 3Y mean read 33.54x, BABA’s EV / Fwd EBIT trend certainly imply a hugely undervalued stock as BABA is still expected to grow its revenue and operating profits rapidly. However, as we wanted to obtain greater clarity over how its counterparts are also valued, we thought it would be useful if we value BABA’s EBIT over a set of benchmark companies that is presented below.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/d27873e676dfb23c98d4a69aa5861e02\" tg-width=\"1280\" tg-height=\"1117\"><span>Peers EV / EBIT Valuations. Data source: S&amp;P Capital IQ</span></p>\n<p>By using a blend of historical and forward EBIT, we could see that BABA’s EV / EBIT really looks undervalued when compared to the median value of the set of observed values from the benchmark companies. We derived a fair value range for BABA of $294.98 at the midpoint of the range, that represented a potential upside of 40.5% based on the current stock price of $210.</p>\n<p><b>Risks to Assumptions</b></p>\n<p>Now, it’s obviously baffling to watch how Mr. Market has decided to discount BABA to such an extent as if the company has lost all its key sources of growth, when in fact there is still so much potential upside coming from its commerce segment, the new marketplace initiatives and its growing Ali Cloud segment, among others. The main realistic reason that we identified for the stock's underperformance would simply be regulatory risk. We think investors should acknowledge that this risk is very real and at times huge Chinese companies have found themselves to be subjected to extra scrutiny (which is nothing new in fact) by the Chinese government. What’s critical here is that the Chinese government seemingly has significant clout over the behavior and actions of their tech behemoths that at times may be largely unpredictable. The market certainly hates unpredictability and therefore they may have significantly discounted BABA as a result of that. If investors are not able to handle uncertainty with regard to potentially unpredictable regulatory actions and their aftermath, then BABA may not be appropriate for you. However, if you believe that this is just a blip in BABA’s long journey, then you would surely find BABA's valuations extremely attractive right now, coupled with a long term mindset.</p>\n<p><b>Wrapping It All Up</b></p>\n<p>Alibaba has continued to deliver solid results that demonstrated the strong capability of the company to execute well. As the company continues to operate within a market with so many growth drivers that are expected to drive the company’s future growth, investors should find the current valuations highly attractive.</p>","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Alibaba Stock: The Bottoming Process Looks To Be Forming Already</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nAlibaba Stock: The Bottoming Process Looks To Be Forming Already\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-06-18 09:07 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4435297-alibaba-stock-bottoming-process-forming-buy-now><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nAlibaba is probably the most undervalued growth stock right now.\nThe company’s multiple growth drivers within a rapidly expanding market made its valuations look even more baffling.\nThe short...</p>\n\n<a href=\"https://seekingalpha.com/article/4435297-alibaba-stock-bottoming-process-forming-buy-now\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{},"source_url":"https://seekingalpha.com/article/4435297-alibaba-stock-bottoming-process-forming-buy-now","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1175693382","content_text":"Summary\n\nAlibaba is probably the most undervalued growth stock right now.\nThe company’s multiple growth drivers within a rapidly expanding market made its valuations look even more baffling.\nThe short term technical picture may be turning bullish with a potential double bottom price action signal.\nWe discuss the company’s multiple growth drivers and let investors judge for themselves.\n\nYongyuan Dai/iStock Unreleased via Getty Images\nThe Technical Thesis\nSource: TradingView\nAlibaba’s stock price has endured a terrible 8 months ever since its Ant Financial IPO was pulled in early Nov 20, with the stock languishing in the doldrums 34% off its high. When considering the health of its long term uptrend, it’s clear that BABA has a relatively strong uptrend bias and has generally been well supported along its key 50W MA. The only other time in the last 4 years that it lost its key 50W MA support level was during the 2018 bear market where BABA dropped about 40%, but was still well supported above the important 200W MA, which we usually consider as the “last line of defense”. Right now BABA is somewhat facing a similar situation again: down 34%, lost the 50W MA, but looks to be well supported above the 200W MA. In addition to that, one interesting observation in price action analysis may lead price action traders/investors to be especially bullish: a potential double bottom formation. BABA's price is seemingly going through a double bottom like it did during the 2018 bear market before it rallied strongly thereafter. As a result, BABA’s current level may offer a possible technical buy entry point now.\nBABA's Fundamental Thesis: Rapidly Expanding Growth Drivers\nAnnual GMV. Data source: Company filings\nAnnual e-commerce revenue. Data source: Company filings\nBABA’s GMV grew from 1.68T yuan to 7.49T yuan in just a matter of 7 years, which represented a CAGR of 23.8%, a truly amazing growth rate. We also saw its GMV growth being converted into revenue growth as its China commerce revenue grew from 7.67B yuan to 473.68B yuan, at a CAGR of 51% over the last 10 years. While its international footprint remains considerably smaller, it still grew at a CAGR of 30.42% over the last 10 years, which was by no means slow.\nEven though China’s e-commerce market is expected to grow considerably slower at a CAGR of 12.4% over the next three years, from 13.8T yuan, equivalent to $2.16T in 2021 to 19.6T yuan,equivalent to $3.06T by 2024, the massive size of the market still offers tremendous upside potential for BABA and its closest competitors to grow into.\nE-commerce revenue in the U.S. Data source: Statista\nWhen we take things into clearer perspective by comparing China’s growth rate and size of its market to that of the U.S. e-commerce market, we could see the huge differences in their sizes and growth rates as the U.S. e-commerce market is only expected to grow at a CAGR of 4.67% from 2021 to 2025, which is significantly slower than China’s 12.4%. In addition, the U.S. market is also expected to reach about $563B in total revenue, which is 18% of what the China market is expected to be worth by then.\nPeers EBIT Margin and Projected EBIT Margin. Data source: S&P Capital IQ\nEven though Alibaba has been facing increased competitive pressures from its fast growing key competitors: JD.com(NASDAQ:JD)and Pinduoduo(NASDAQ:PDD), BABA has already been operating a much more profitable business (both EBIT and FCF), and is expected to continue delivering strong profitability moving forward, which should give the company tremendous flexibility to compete head on with JD and PDD in its quest to extend its leadership. Investors may observe that BABA’s EBIT margin was affected by the one-off administrative penalty of $2,782M that was reflected in its SG&A, and therefore skewed its EBIT margin to the downside.\nOne important move was the company’s decision to further its investment in the Community Marketplace, which is PDD’s main e-commerce strategy that saw PDD gain a total of 823M AAC in its latest quarter as compared to BABA’s 891M AAC. PDD’s AAC growth is truly phenomenal considering it had only 100M AAC in Q2’C17 as compared to BABA’s 466M AAC in the same period.\nTherefore, the momentum of growth has surely swung over to the Community Marketplace segment and BABA would need to pull out its big guns (which it has) to compete for dominance with PDD and JD.\nMarket size of community group buying in China. Data source: iiMedia Research\nEven though the expected total market size of 102B yuan by 2022 represented only about 21.5% of BABA’s FY 21 China commerce revenue, the expected rapid CAGR of 44.22% over 3 years from 2019 to 2022 cannot be missed by BABA. Although the market is still relatively small, BABA cannot allow the current leader in this market: PDD to so easily dominate and gobble up the early high growth rates at the ignorance of everyone else. Certainly BABA must compete and fight for its place in this segment and strive for early leadership to prevent PDD from extending its lead.\nPDD profitability metrics & revenue growth forecast. Data source: S&P Capital IQ\nWe could observe from the above chart that PDD is expected to continue growing its revenue rapidly over the next few years, even though they are expected to normalize subsequently. More importantly, PDD is also expected to increasingly improve its EBIT and FCF profitability moving forward. This shows that the Community Marketplace segment is an highly important growth driver that BABA must use its strength to exploit in order to deny PDD’s claim to undisputed leadership so early on in the game.\nChina public cloud spending. Source:China Internet Watch; Canalys\nSize of China public cloud market. Data source: CAICT; Sina.com.cn\nBABA has a 40% share in China’s public cloud market, way ahead of its key competitors. However, it’s important to note that despite this leadership, BABA is still in heavy investment mode to continue growing its market share as China’s public cloud market is expected to grow from 26.48B yuan in 2017 to 230.74B yuan by 2023, which would represent a CAGR of 43.4%, an incredibly stellar growth rate. This is especially clear when we compare China’s growth rate to the worldwide growth rate (see below) as public cloud spending worldwide is expected to grow from $145B in 2017 to $397B by 2022, that would represent a CAGR of 22.3%.\nWorldwide public cloud spending. Data source: Gartner\nWorldwide public cloud market share. Source:CnTechPost; Gartner\nTherefore, I don’t find it surprising that Ali Cloud has continued to extend its lead over Alphabet’s(NASDAQ:GOOGL)(NASDAQ:GOOG)GCP with a market share of 9.5% in 2020. While AMZN remains the clear leader in the market, its market share has been coming down considerably as public cloud spending continues to expand, indicating that there is a huge potential for growth for multiple players to exist. With BABA’s leadership in the rapidly expanding Chinese market, I’m increasingly bullish on the future profit and FCF contribution from this segment to BABA’s performance over time. Although BABA’s cloud segment has not been EBIT profitable yet (FY 21 EBIT margin: -15%, FY 20 EBIT margin: -17.5%), it’s also useful to note that GCP has also not been profitable for Alphabet as well (FY 20 EBIT margin: -42.9%, FY 19 EBIT margin: -52%). Therefore, we need to give BABA some time to scale up its cloud services in APAC and in China where it is expected to have stronger leadership to allow it to grow faster and investors should expect this to be a highly profitable segment over time.\nBABA's Valuations Look Highly Compelling\nNTM TEV / EBIT 3Y range.\nEV / Fwd EBIT and EV / Fwd Rev trend. Data source: S&P Capital IQ\nWhen we consider BABA's TEV / EBIT historical range, where the 3Y mean read 33.54x, BABA’s EV / Fwd EBIT trend certainly imply a hugely undervalued stock as BABA is still expected to grow its revenue and operating profits rapidly. However, as we wanted to obtain greater clarity over how its counterparts are also valued, we thought it would be useful if we value BABA’s EBIT over a set of benchmark companies that is presented below.\nPeers EV / EBIT Valuations. Data source: S&P Capital IQ\nBy using a blend of historical and forward EBIT, we could see that BABA’s EV / EBIT really looks undervalued when compared to the median value of the set of observed values from the benchmark companies. We derived a fair value range for BABA of $294.98 at the midpoint of the range, that represented a potential upside of 40.5% based on the current stock price of $210.\nRisks to Assumptions\nNow, it’s obviously baffling to watch how Mr. Market has decided to discount BABA to such an extent as if the company has lost all its key sources of growth, when in fact there is still so much potential upside coming from its commerce segment, the new marketplace initiatives and its growing Ali Cloud segment, among others. The main realistic reason that we identified for the stock's underperformance would simply be regulatory risk. We think investors should acknowledge that this risk is very real and at times huge Chinese companies have found themselves to be subjected to extra scrutiny (which is nothing new in fact) by the Chinese government. What’s critical here is that the Chinese government seemingly has significant clout over the behavior and actions of their tech behemoths that at times may be largely unpredictable. The market certainly hates unpredictability and therefore they may have significantly discounted BABA as a result of that. If investors are not able to handle uncertainty with regard to potentially unpredictable regulatory actions and their aftermath, then BABA may not be appropriate for you. However, if you believe that this is just a blip in BABA’s long journey, then you would surely find BABA's valuations extremely attractive right now, coupled with a long term mindset.\nWrapping It All Up\nAlibaba has continued to deliver solid results that demonstrated the strong capability of the company to execute well. As the company continues to operate within a market with so many growth drivers that are expected to drive the company’s future growth, investors should find the current valuations highly attractive.","news_type":1},"isVote":1,"tweetType":1,"viewCount":461,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":169260548,"gmtCreate":1623838155784,"gmtModify":1634027324895,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"Big money&nbsp;","listText":"Big money&nbsp;","text":"Big money","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":1,"repostSize":0,"link":"https://laohu8.com/post/169260548","repostId":"1105866425","repostType":4,"isVote":1,"tweetType":1,"viewCount":865,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":126979757,"gmtCreate":1624543285779,"gmtModify":1634004628067,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"Sure bo","listText":"Sure bo","text":"Sure bo","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://laohu8.com/post/126979757","repostId":"2145046329","repostType":4,"isVote":1,"tweetType":1,"viewCount":492,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":121064484,"gmtCreate":1624445287148,"gmtModify":1634006072992,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"More growth","listText":"More growth","text":"More growth","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://laohu8.com/post/121064484","repostId":"1145825451","repostType":4,"repost":{"id":"1145825451","kind":"news","pubTimestamp":1624433586,"share":"https://www.laohu8.com/m/news/1145825451?lang=&edition=full","pubTime":"2021-06-23 15:33","market":"us","language":"en","title":"Why I Believe NIO Will Beat Out Tesla","url":"https://stock-news.laohu8.com/highlight/detail?id=1145825451","media":"InvestorPlace","summary":"The fact that Tesla scrapped its Model S Plaid Plus release is just part of it.Super fans of the latest and greatest high-endTesla, Inc. model received some disappointing news a week ago when CEO Elon Musk abruptly canceled the release of its highly anticipated Model S Plaid Plus with a tweet on June 6.Instead, the company has begun delivering a new Model S Plaid that has only a 390-mile range and 1,020 horsepower, though it still sprints to from 0 to 60 miles per hour in just two seconds.The go","content":"<blockquote>\n <b>The fact that Tesla scrapped its Model S Plaid Plus release is just part of it.</b>\n</blockquote>\n<p>Super fans of the latest and greatest high-end<b>Tesla, Inc.</b>(NASDAQ:<b>TSLA</b>) model received some disappointing news a week ago when CEO Elon Musk abruptly canceled the release of its highly anticipated Model S Plaid Plus with a tweet on June 6.</p>\n<p><img src=\"https://static.tigerbbs.com/b294a3604c7ba82bd19b3c70be3a4020\" tg-width=\"300\" tg-height=\"169\" referrerpolicy=\"no-referrer\">Source: nrqemi / Shutterstock.com</p>\n<p>Musk wrote there was… “No need, as Plaid is just so good.”</p>\n<p>The Model S Plaid Plus was supposed to be the fastest, most powerful and priciest version of the company’s Model S. Priced at $149,990, it was to feature a range of 520 miles, thanks to its innovative 4680 battery cells, 1,100 horsepower and the ability to speed from 0 to 60 mph in less than two seconds.</p>\n<p>Instead, the company has begun delivering a new Model S Plaid that has only a 390-mile range and 1,020 horsepower, though it still sprints to from 0 to 60 miles per hour in just two seconds.</p>\n<p>As a way to “sugar coat” its flip flop, Tesla said the Model S Plaid is just as fast as the Model S Plaid Plus and $20,000 cheaper. Humm.</p>\n<p>This “bait and switch” has some Tesla fans worried, since they had deposits on the Model S Plaid Plus and wanted the innovative 4680 battery cells that Tesla had been touting as the key to longer range and more power. Essentially, the 4680 battery cells were the latest great Tesla development, since they were the first batteries to also be a structural component that supposedly allowed Tesla to lower the weight of its vehicles.</p>\n<p>Both the company’s Austin and Berlin manufacturing plants now under construction are supposed to also be making the 4680 batteries for new Tesla vehicles. If there is a problem with the engineering associated with utilizing the 4680 batteries or making them a structural component, then Tesla has grossly miscalculated, which is now worrying investors.</p>\n<p>Clearly something happened to delay the 4680 batteries that were supposed to provide Tesla with a competitive and engineering edge. For Tesla’s sake, I hope they figure out the problems associated with their much hyped 4680 battery cells, otherwise concerns about its two new manufacturing plants will emerge, as well as the stock losing more of its “mojo.”</p>\n<p>As someone who owns more than a few high-performance vehicles, I can tell you that the engineering geeks I know do<i>not</i>want to get a new Model S Plaid instead of a Model S Plaid Plus and will likely ask for their deposits back.</p>\n<p>What Tesla did is like Ferrari or Porsche telling its customers that one of their much-hyped new performance models is now not being sold because the base model was just as good! Car fanatics, like myself, like the latest and greatest engineering tidbits, so we would rather cancel our orders versus settle for a base model.</p>\n<p>The good news for Tesla is that its China sales in May resurged to 21,936, up sharply from 11,671 in April. The company’s sales tend to spike at the end of each quarter. For example, Tesla sold 35,478 vehicles in China in March, which was the strongest month ever in China.</p>\n<p>This is raising expectations for very strong China sales in June, especially now that the Model Y is being manufactured in Shanghai. Interestingly, since most Chinese Teslas are now made with iron phosphate batteries, these vehicles have lower range than its lithium cobalt vehicles, but its iron phosphate vehicles are cheaper and now increasingly being exported to Europe.</p>\n<p>However, I’m convinced another electric vehicle (EV) company will eventually displace Tesla as the biggest manufacturer of EVs in China.</p>\n<p><b>Taking Advantage of the EV Revolution’s Profit Potential</b></p>\n<p>I’m talking about&nbsp;<b>Nio, Inc.</b>(NYSE:<b>NIO</b>). The reality is that this company is on the verge of dominating the EV market in China and Hong Kong. It’s why I put NIO on my<b><i>Platinum Growth Club</i></b>Model Portfolio back in February.</p>\n<p>The company boasts that it is the “next-generation car company,” as it designs and manufactures electric vehicles that utilize the latest technologies in connectivity, autonomous driving and artificial intelligence (AI). NIO currently offers an electric seven-seater SUV (ES8) and a five-seater electric SUV (ES6) and recently introduced an attractive electric sedan (ET7). Its vehicles utilize NOMI, an in-vehicle artificial intelligence assistant.</p>\n<p>The company is also partnering with cutting-edge chip companies like<b>NVIDIA Corporation</b>(NASDAQ:<b>NVDA</b>), another one of my<b><i>Platinum Growth Club</i></b>Model Portfolio stocks. NIO plans to use the NVIDIA DRIVE Orin system-on-a-chip for its electric vehicles that will provide autonomous driving capabilities. The NVIDIA DRIVE Orin-powered supercomputer, which is being called Adam, will be launched in the ET7 sedan in China in 2022. Announcements like this are very positive, so NIO has been stealing some of Tesla’s thunder lately.</p>\n<p>Now, it’s important to note that NIO was bailed out by the Chinese government. Last year, the Chinese government injected $1 billion and now has a 24% ownership in the company. The reality is that China wants to dominate at least five major industries by 2025, and NIO is now its ticket to dominate EV manufacturing.</p>\n<p>With the backing of the Chinese government, some Wall Street firms are eager to help NIO by issuing new debt or equity. So, I wouldn’t be surprised if NIO surpasses Tesla, which is currently number-two in China, for market share in the upcoming years.</p>\n<p>That means, if you missed Tesla’s parabolic run like I did, NIO is essentially giving us a “second chance” to make money in a potentially explosive electric vehicle company.</p>\n<p>Shares of NIO climbed nearly 13% since the company’s June 4 announcement of its May delivery report and positive analyst comments, while Tesla shares rose almost 3%. First, NIO revealed that the global chip shortage is starting to take a toll on its business. NIO only delivered 6,711 vehicles in May, or a 5.5% decline from April’s deliveries. Company management noted that deliveries were “adversely impacted for several days due to the volatility of semiconductor supply and certain logistical adjustments.”</p>\n<p>Interestingly, despite the month-to-month dip, NIO’s deliveries were still up 95.3% year-over-year. Strong demand in China even inspired a Citigroup analyst to upgrade NIO to a buy rating, as he expects demand to accelerate in the coming months.</p>\n<p>In other words, NIO represents the<b>crème de la crème</b>of EV stocks right now.</p>","source":"lsy1606302653667","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Why I Believe NIO Will Beat Out Tesla</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nWhy I Believe NIO Will Beat Out Tesla\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-06-23 15:33 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://investorplace.com/2021/06/why-i-believe-nio-will-beat-out-tesla/><strong>InvestorPlace</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The fact that Tesla scrapped its Model S Plaid Plus release is just part of it.\n\nSuper fans of the latest and greatest high-endTesla, Inc.(NASDAQ:TSLA) model received some disappointing news a week ...</p>\n\n<a href=\"https://investorplace.com/2021/06/why-i-believe-nio-will-beat-out-tesla/\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{},"source_url":"https://investorplace.com/2021/06/why-i-believe-nio-will-beat-out-tesla/","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1145825451","content_text":"The fact that Tesla scrapped its Model S Plaid Plus release is just part of it.\n\nSuper fans of the latest and greatest high-endTesla, Inc.(NASDAQ:TSLA) model received some disappointing news a week ago when CEO Elon Musk abruptly canceled the release of its highly anticipated Model S Plaid Plus with a tweet on June 6.\nSource: nrqemi / Shutterstock.com\nMusk wrote there was… “No need, as Plaid is just so good.”\nThe Model S Plaid Plus was supposed to be the fastest, most powerful and priciest version of the company’s Model S. Priced at $149,990, it was to feature a range of 520 miles, thanks to its innovative 4680 battery cells, 1,100 horsepower and the ability to speed from 0 to 60 mph in less than two seconds.\nInstead, the company has begun delivering a new Model S Plaid that has only a 390-mile range and 1,020 horsepower, though it still sprints to from 0 to 60 miles per hour in just two seconds.\nAs a way to “sugar coat” its flip flop, Tesla said the Model S Plaid is just as fast as the Model S Plaid Plus and $20,000 cheaper. Humm.\nThis “bait and switch” has some Tesla fans worried, since they had deposits on the Model S Plaid Plus and wanted the innovative 4680 battery cells that Tesla had been touting as the key to longer range and more power. Essentially, the 4680 battery cells were the latest great Tesla development, since they were the first batteries to also be a structural component that supposedly allowed Tesla to lower the weight of its vehicles.\nBoth the company’s Austin and Berlin manufacturing plants now under construction are supposed to also be making the 4680 batteries for new Tesla vehicles. If there is a problem with the engineering associated with utilizing the 4680 batteries or making them a structural component, then Tesla has grossly miscalculated, which is now worrying investors.\nClearly something happened to delay the 4680 batteries that were supposed to provide Tesla with a competitive and engineering edge. For Tesla’s sake, I hope they figure out the problems associated with their much hyped 4680 battery cells, otherwise concerns about its two new manufacturing plants will emerge, as well as the stock losing more of its “mojo.”\nAs someone who owns more than a few high-performance vehicles, I can tell you that the engineering geeks I know donotwant to get a new Model S Plaid instead of a Model S Plaid Plus and will likely ask for their deposits back.\nWhat Tesla did is like Ferrari or Porsche telling its customers that one of their much-hyped new performance models is now not being sold because the base model was just as good! Car fanatics, like myself, like the latest and greatest engineering tidbits, so we would rather cancel our orders versus settle for a base model.\nThe good news for Tesla is that its China sales in May resurged to 21,936, up sharply from 11,671 in April. The company’s sales tend to spike at the end of each quarter. For example, Tesla sold 35,478 vehicles in China in March, which was the strongest month ever in China.\nThis is raising expectations for very strong China sales in June, especially now that the Model Y is being manufactured in Shanghai. Interestingly, since most Chinese Teslas are now made with iron phosphate batteries, these vehicles have lower range than its lithium cobalt vehicles, but its iron phosphate vehicles are cheaper and now increasingly being exported to Europe.\nHowever, I’m convinced another electric vehicle (EV) company will eventually displace Tesla as the biggest manufacturer of EVs in China.\nTaking Advantage of the EV Revolution’s Profit Potential\nI’m talking about Nio, Inc.(NYSE:NIO). The reality is that this company is on the verge of dominating the EV market in China and Hong Kong. It’s why I put NIO on myPlatinum Growth ClubModel Portfolio back in February.\nThe company boasts that it is the “next-generation car company,” as it designs and manufactures electric vehicles that utilize the latest technologies in connectivity, autonomous driving and artificial intelligence (AI). NIO currently offers an electric seven-seater SUV (ES8) and a five-seater electric SUV (ES6) and recently introduced an attractive electric sedan (ET7). Its vehicles utilize NOMI, an in-vehicle artificial intelligence assistant.\nThe company is also partnering with cutting-edge chip companies likeNVIDIA Corporation(NASDAQ:NVDA), another one of myPlatinum Growth ClubModel Portfolio stocks. NIO plans to use the NVIDIA DRIVE Orin system-on-a-chip for its electric vehicles that will provide autonomous driving capabilities. The NVIDIA DRIVE Orin-powered supercomputer, which is being called Adam, will be launched in the ET7 sedan in China in 2022. Announcements like this are very positive, so NIO has been stealing some of Tesla’s thunder lately.\nNow, it’s important to note that NIO was bailed out by the Chinese government. Last year, the Chinese government injected $1 billion and now has a 24% ownership in the company. The reality is that China wants to dominate at least five major industries by 2025, and NIO is now its ticket to dominate EV manufacturing.\nWith the backing of the Chinese government, some Wall Street firms are eager to help NIO by issuing new debt or equity. So, I wouldn’t be surprised if NIO surpasses Tesla, which is currently number-two in China, for market share in the upcoming years.\nThat means, if you missed Tesla’s parabolic run like I did, NIO is essentially giving us a “second chance” to make money in a potentially explosive electric vehicle company.\nShares of NIO climbed nearly 13% since the company’s June 4 announcement of its May delivery report and positive analyst comments, while Tesla shares rose almost 3%. First, NIO revealed that the global chip shortage is starting to take a toll on its business. NIO only delivered 6,711 vehicles in May, or a 5.5% decline from April’s deliveries. Company management noted that deliveries were “adversely impacted for several days due to the volatility of semiconductor supply and certain logistical adjustments.”\nInterestingly, despite the month-to-month dip, NIO’s deliveries were still up 95.3% year-over-year. Strong demand in China even inspired a Citigroup analyst to upgrade NIO to a buy rating, as he expects demand to accelerate in the coming months.\nIn other words, NIO represents thecrème de la crèmeof EV stocks right now.","news_type":1},"isVote":1,"tweetType":1,"viewCount":431,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":126973136,"gmtCreate":1624543299625,"gmtModify":1634004627718,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"👌🏻","listText":"👌🏻","text":"👌🏻","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://laohu8.com/post/126973136","repostId":"1152622139","repostType":4,"isVote":1,"tweetType":1,"viewCount":681,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":166104202,"gmtCreate":1623994816306,"gmtModify":1634024396428,"author":{"id":"3575431934988709","authorId":"3575431934988709","name":"MrNikki","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":3,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3575431934988709","authorIdStr":"3575431934988709"},"themes":[],"htmlText":"Nice","listText":"Nice","text":"Nice","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://laohu8.com/post/166104202","repostId":"2144742925","repostType":4,"isVote":1,"tweetType":1,"viewCount":995,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0}],"lives":[]}