Is it Still Worthy to Invest in Alibaba Group (BABA)?

Oakmark Funds, an investment management firm, published its “Oakmark Global Select Fund” fourth quarter 2021 investor letter – a copy of which can be seen here.  A return of 2.3% was reported by the fund in the fourth quarter of 2021, underperforming the MSCI World Index, which returned 7.8% for the same period. The Fund finished the calendar year with a positive absolute performance of 19.2%, compared to the index’s return of 21.8%. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.

Oakmark Global Fund, in its Q4 2021 investor letter, mentioned Alibaba Group Holding Limited (NYSE: BABA) and discussed its stance on the firm. Alibaba Group Holding Limited is a Hangzhou, China-based e-commerce company with a $321.0 billion market capitalization. BABA delivered a -5.89% return since the beginning of the year, while its 12-month returns are down by -57.13%. The stock closed at $111.79 per share on January 27, 2022.

Here is what Oakmark Global Fund has to say about Alibaba Group Holding Limited in its Q4 2021 investor letter:

Alibaba Group (China) was a top detractor for the quarter due to increased regulation from the Chinese government on local technology businesses, which continued to pressure the company’s share price. In addition, investors were disappointed with second-quarter earnings reported in November, marked by decelerating growth and lowered revenue guidance for the full year. Alibaba’s slowing growth was attributable to decreased retail spending in China, increased e-commerce competition and the company’s reinvestments into its merchant base. Although the company currently faces several headwinds, we believe Alibaba is an important driver of innovation in China, and several of its businesses have yet to fully scale. Finally, we believe the shares are undervalued given the quality of the company’s assets and its technological know-how.”

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Our calculations show that Alibaba Group Holding Limited (NYSE: BABA) ranks 13th on our list of the 30 Most Popular Stocks Among Hedge Funds. BABA was in 115 hedge fund portfolios at the end of the third quarter of 2021, compared to 146 funds in the previous quarter. Alibaba Group Holding Limited (NYSE: BABA) delivered a -34.16% return in the past 3 months.

In December 2021, we also shared another hedge fund’s views on BABA in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.

Disclosure: None. This article is originally published at Insider Monkey.