Alibaba and Yahoo shares are soaring.
This is an educational opinion post only. Not advice to buy or sell any security. Please read my disclaimers. Ok on to the analysis.
Just to run an update on my GPRO blog that I posted when the stock was at $96 claiming things that Jim Cramer even said! I would not be a buyer at these highs. It doesn’t make sense. Your sales are a billion and its trading as if it has 50-100 billion in sales that are going to happen in the future. Yea right!
OK ALIBABA shares hit a new 52 week high, this and BIDU are the only two Chinese ADR’s that are on my “it’s ok to trade only two adr’s” as long as its BIDU and BABA. Used to only be BABA. Most chinese ADR’s lie on their revenues, and do not hold up to standard GAAP account principles that we use in the states.
BABA is soaring and I believe is overvalued.
Here is a chart of BABA and it is soaring, and close to an exhaustion point in my humble opinion.
YAHOO AND BABA are running hand in hand as of right now, and also along with the overall market.
“Quoted from barrons article. “Barron’s calculates Yahoo’s net asset value is now around $70 per share, and the largest portion of that is its 383 million shares of Alibaba, which are now worth about $45 billion, or $46 per Yahoo share. There is nearly 0.4 share of Alibaba embedded in every Yahoo share, meaning Yahoo should move roughly 40 cents for every $1 change in Alibaba – before adjusting for taxes.” End quote.
Here is a chart on that. Demand for stocks run out on big legs up like this. Be very careful out there!
Look at GPRO lined up with BABA they look IDENTICAL, the pullback is the only thing that has yet to happen with BABA!!!