Alibaba Group Holding Ltd (NYSE:BABA) was the subject of criticism on Wall Street after the company failed beat estimates on revenues, a reaction that saw the stock sink in the market by high margins. The bashing in the market had to do with the company posting a 40% growth in revenue against estimates of 47%. The author of The Haft of It, Alan Haft, during an interview on CNBC, reiterated his confidence on the company, maintaining the stock remains a strong buy at the current lows.
The giant Chinese company posted revenues of $4.22 billion against analyst estimates of $4.44 billion, one of the reasons why it sunk in the market, despite earnings per share coming in at 81 cents against Wall Street estimates of 75 cents.
“[…] The complaint was that a lot of that growth was not slow and steady during the quarter it was really concentrated on Singles day. […] I don’t see where the bad news is on the stock I say just buy it on those dips because it is a great company for a long term investor,” said Mr. Haft.
Much of the decline in the market had to do with Wall Street reacting to reports that Alibaba Group Holding Ltd (NYSE:BABA) was entangled in standoff with the Chinese government on allegations it was not doing enough to curtail the sale of counterfeit goods. Haft maintains that the government being strict on Alibaba Group Holding Ltd (NYSE:BABA) with regards to counterfeit goods is a clear indication that it wants it to succeed in legitimate business.
Alibaba Group Holding Ltd (NYSE:BABA), on the other hand, might be struggling on the international front seen from its online platform Tmall Global failing to live up to expectations in terms of sales. Haft maintains investors should not be concerned about possible struggles on the international front as the company could still make it big in China as internet penetration continues to grow.
“If they stayed in China and just focused on the Chinese market less than 50% of the people in China are on mobile are on desktop with population of 3 billion. Personally I would like to see them focus on the Chinese market,” said Mr. Haft
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