Seems like Alibaba (BABA) stock downward trend will continue during this month and possibly for the rest of the year.
A lot has rained in on Alibaba investors recently: canceled Ant Group IPO, industry rotation after the US election, cautiously received quarterly figures, records at the Global Shopping Festival, the announcement of regulation by the Chinese leadership. After the sharp rise in recent months, the course is now correcting significantly.
What else could push BABA stock price down?
Class Action Lawsuits could follow. Alibaba has many more problems as a result of the IPO cancellation. So now certain foreign investors feel cheated. In the United States in particular, law firms make a lot of money with class action lawsuits that are now pending lawsuits against Alibaba. But class actions are also being prepared in Hong Kong.
Since the middle of the year, the analysts’ price target for the next twelve months has risen to an average of almost $ 100: the current consensus is $ 340.69, which is almost 32 percent above the current price.
What the analysts are saying?
Australian investment bank Macquarie is particularly optimistic with a target of $ 394. At a price of last 258.31 dollars, this corresponds to around 53 price potential.
Morningstar, on the other hand, still only advises hold, but has raised its price target from $ 285 to $ 296. Even the target that was earlier is clearly above the current course.
BABA technical chart
As always analysts are late to the game, raising and cutting their expectations according to the moves on the stock exchange.
BABA technical chart shows that stock price still did not bottomed out and there may be another 10% loss before shares bounce back. Of course, if nothing else happens in the meantime.