Morgan Stanley reaffirms Alibaba’s US shares as top pick, with overweight rating
COMPANY NEWS STOCKS VIEWS & ANALYSIS
Morgan Stanley reaffirms Alibaba’s US shares as top pick, with overweight rating
COMPANY NEWS STOCKS VIEWS & ANALYSIS

Morgan Stanley reaffirms Alibaba’s US shares as top pick, with overweight rating

 

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Alibaba’s customer management revenue (CMR) for China retail and adjusted EBITA are expected to grow by 5.5% and 18%, respectively, in the quarter ending June compared to a year earlier, driven by the recovery of its core business, international business, Cainiao services and local services, said Morgan Stanley in a note. 

Shareholders returns were boosted by stable core business, free cash flow released from restructuring and potential monetization of non-core business, it said.

The broker reaffirmed Alibaba’s US shares as a Top Pick, with an Overweight rating and a target price of $150. The broker expected the group’s total cash available for distribution could reach $235 billion in the next three years.

Morgan Stanley expected Alibaba’s revenue for the quarter to be 226 billion yuan, up 10% year over year and 1% higher than market expectations. 

Consumer recovery is on track and the high-quality growth in GMV, DAU and time spent by users during the 618 festival proves the effectiveness of Taobao Tmall’s latest investment strategy to drive user experience through content, traffic and time spent, it said.