- Thomson Reuters
- Shares of Alibaba are up more than 3% Thursday thanks to strong sales data from the Chinese government.
- The company is also seeking to move its stock listing to China from the NYSE, the Wall Street Journal reported Thursday.
E-commerce is skyrocketing in China, the country’s National Bureau of Statistics said Thursday, and Alibaba is reaping the rewards.
Online retail sales in the country grew 37% in the first two months of 2018, NBS reported, up from 32% growth the prior month. Meanwhile, traditional retail sales grew just 9.7% – falling just short of the expected 9.8%.
“Taking into consideration normal seasonality pattern, this gives us a higher level of comfort in our Alibaba’s FY18 GMV growth estimate of c.30% with potential upside,” Jefferies analyst Karen Chan said in a note to clients Thursday, reiterating her buy rating and $325 price target.
Jefferies is one of the Alibaba’s biggest bulls, with a price target 41% above the Wall Street consensus of $230 per share.
“We believe the strong online retail sales in spite of weak seasonality could be attributed to: 1) a longer-than-usual shopping window prior to Chinese New Year holiday; 2) increased rural consumption spending over CNY from post-80s with smart home electronics and imported fresh goods showing fast growth; 3) step-up in online-offline promotional efforts, e.g. red packets, Taobao-RTmart (SunArt) promotion; 4) enhanced logistics service for fresh goods, e.g. Hema,” Chan said.
The Wall Street Journal also reported early Thursday that the company was seeking to move its stock listing home to mainland China, citing people familiar with the matter. Alibaba has traded on the New York Stock Exchange ever since it went public in 2014 in the world’s largest IPO.
Shares of Alibaba are up 4% in early trading Thursday and 85% in the past year.