Applied Professional Report on Alibaba: Analysts' Reports and Evaluation

This report evaluates the analysts' reports on Alibaba and highlights missing items, interesting approaches, and changes in opinion. It also includes a summary of the reports and references.

Running head: APPLIED PROFESSIONAL REPORT
Applied Professional Report
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1APPLIED PROFESSIONAL REPORT
Table of Contents
Summary of the analysts’ reports:...................................................................................................2
Missing items or issues in the above report of Alibaba:..................................................................2
Interesting approaches in the report of Alibaba:..............................................................................3
Change in opinion owing to the report of Alibaba:.........................................................................3
References:......................................................................................................................................4

2APPLIED PROFESSIONAL REPORT
Summary of the analysts’ reports:
The first analyst report is comparison of Alibaba with its core global competitor, which is
Amazon. Even though Alibaba has smaller operations compared to those of Amazon, the former
seems to be much more profitable in terms of stock return. The e-commerce revenue for Amazon
constitutes of online and physical stores, subscription services, third party seller services and
advertising. In case of Alibaba, the revenue from the specified segment comes from its core
commerce, innovation initiatives and digital media and entertainment (Rossolillo). On the other
hand, according to the analyst report for the next 12-month price forecast, Alibaba has median
target of 199.98 with low estimate of 123 and high estimate of 260 (Money.cnn.com).
Missing items or issues in the above report of Alibaba:
The first issue that needs to be mentioned is that Amazon has experienced growth of 52%
in subscription services, while media and entertainment services of Alibaba have grown by 24%
in the past quarter (Rossolillo). In addition, Amazon is diversifying its advertising business to
online marketplace. In this segment, 122% growth has been achieved in the past quarter and it is
now accountable for maximum profit growth in the e-commerce operations of Amazon. Thus, it
could be stated that even though Alibaba is the leader in e-commerce from the profitability
perspective, Amazon is narrowing the gap slowly (Wu and Gereffi 333).
The second issue highlighted from the report of the analysts regarding the organization.
The median depicts an increase of 34.22% from the previous price of 149. On the other hand, the
trend has been declining according to the above report and thus, this issue has not been identified
in the above report (Money.cnn.com).

3APPLIED PROFESSIONAL REPORT
Interesting approaches in the report of Alibaba:
After critical evaluation of the above report, it has been identified that Alibaba operates
in a highly ethical manner for addressing the concerns of the overall community. The corporate
culture of the organization is based on better governance as well as responsible management by
maintaining greater standards and accountability (Cai et al. 390). In addition, it has been
observed that the organization is focused on increased its retained earnings, as no information
regarding dividend per share has been disclosed in the annual report. Another interesting
approach that could be observed from the report of Alibaba is that it puts forward the interest of
the clients first even if they do match with the business goals. Accordingly, adequate training is
provided to the staffs of the organization so that they could conform to the interests of the clients
by following ethical practices.
Change in opinion owing to the report of Alibaba:
It has been found from the external reports that Amazon is slowly expanding its market
globally by undertaking new measures, which has brought favorable impact on the organization.
Despite the fact that Alibaba would experience a growth in its stock price over the next year
evident from the report and the forecasts of the analysts, Amazon is expected to diversify its
business further in the Chinese market. Even though investing in the shares of Alibaba would
result in higher return for the investors, as they are undervalued, the entry of Amazon might
minimize the expected return of the investors.

4APPLIED PROFESSIONAL REPORT
References:
"BABA - Alibaba Group Holding Ltd Forecast - Cnnmoney.Com." Money.cnn.com. N. p., 2018.
Web. 16 Dec. 2018.
Cai, Li, et al. "Effectuation, exploratory learning and new venture performance: evidence from
China." Journal of Small Business Management 55.3 (2017): 388-403.
Rossolillo, Nicholas. "Better Buy: Alibaba Vs. Amazon -- The Motley Fool." The Motley Fool.
N. p., 2018. Web. 16 Dec. 2018.
Wu, Xinyi, and Gary Gereffi. "Amazon and Alibaba: Internet Governance, Business Models, and
Internationalization Strategies." International Business in the Information and Digital
Age. Emerald Publishing Limited, 2018. 327-356.