Alibaba Group Holding Ltd (NYSE:BABA)’s stock has been soaring this year. At the start of the year the company’s share price was less than $90. As of Wednesday’s close, the share price had reached over $185, more than double what it was at the beginning of the year. The company touted as the ‘Chinese Google’ is doing laps around big tech stocks like Alphabet Inc (NASDAQ:GOOG) and Amazon.com, Inc. (NASDAQ:AMZN) which have gone up just 34% and 51%, respectively.
The challenge for Amazon and Alphabet is that they operate in highly competitive and very saturated markets. Alibaba on the other hand, is a big fish in the world’s largest economy with not much competition. This gives Alibaba more potential as it can capitalize on much more growth while facing a fraction of the competition.
In just three years the company has seen its sales triple. This past year sales grew by an impressive 56% and the company shows no signs of slowing down with its most recent quarter showing sales continuing to rise by more than 60%.
The company is not just in China; it has operations in more than 200 different countries. The sky is the limit for the e-commerce stock with so many possible growth opportunities.
The stock trades at a price to earnings multiple of a little over 50, which is not expensive when you consider how well the company has performed so far and how many opportunities it still has to grow.
The stock has been soaring this year and the longer you wait to buy the more expensive it will inevitably get.
