We all know the stock BABA an his story, one of the biggest company in china that since its foundation is managed to create corporate and budget stability which ensure an economic power with the potential to create new highly profitable market sectors through new investments or to invest in the scalability of existing markets, as is happening in the cloud computing section.
The saturation of the company's reference market makes it necessary to use part of the profits on other markets in order to make growth attractive to investors.
In the long term the price of baba will reflect its real value, currently affected by a short-term market devaluation.
If the company 'll be able to create new segments or achieve high potential growth returns, the attractiveness of the share price compared to its real value will push institutional buyers to buy and the price up.
With a current growth rate of 6.91% over the next 10 yrs we will expect the stock can guarantee a valid ROE, and at current price the temptation to make a stock pie is big.
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