Why Are Chinese Stocks Alibaba, JD.com, Baidu And More Tearing It Up Today?

Many hedge funds still own Alibaba. According to our extensive database of around 730 elite funds, 85 reported owning Alibaba stakes worth $4.77 billion in the latest round of 13F filings, representing 2.30% of the company’s float. That compares to 86 funds with $5.8 billion in Alibaba holdings a quarter prior to that point. Rob Citrone‘s Discovery Capital Management owns 6.52 million shares of Alibaba, while Andreas Halvorsen’s Viking Global owns 6.04 million shares.

As it stands, many Chinese internet stocks are cheap. We wrote about Alibaba before and pointed out that it’s trading at just 20.4 times forward earnings. Given Alibaba’s moat and expected EPS growth rate of 22.8% per year for the next five years, we’re not sure why investors are so pessimistic. If Alibaba rallies because its cheap, other Chinese internet stocks will likely rally too because of the strong correlations, making all of them potentially solid long-term buys.

Disclosure: None