r/baba
WOW so happy today
Aggressively buying the BABA dip, citing massive cash, low valuation, and dominant AI/cloud/ecom positions, expecting a surge to $150.
- Massive cash reserves ($40B net) and extremely low valuation (1.5x P/S) compared to high-flying peers.
- Dominant market positions in China e-commerce and Asia cloud, providing perpetual free cash flow.
- Strong leadership and rapid growth in AI, including LLMs (Qwen) and AI chips.
- Stock is down 40% YTD and faces potential further downside to the $60s before recovering.
- Concerns over IP theft from Anthropic and US sanctions, which could impact operations.
I decided to buy no puts for $2 because puts are a waste of money (my $1B hedge fund manager friend told me). Could of fully hedged my position and any further down fall in price while collecting their sweet 1% dividend for being patient.
Down 40% YTD but it's okay, rewards come to those who are patient.
https://preview.redd.it/qdu6wfuncm9h1.png?width=798&format=png&auto=webp&s=d002318cff7fc8af52a533798692fd4dc1d7a351
This is a once in a life time generational buying opportunity.
How many of you have said: "If it drops back down, I will buy this time"
Now is your chance
IP theft from anthropic, sanctions from the US, all over blown.
Has no impact on the bottom line.
BABA has a massive warchest - $75B cash on hand
After debt, close to $40B which is almost 20% of their marketcap.
Let me show you the figures vs. SPCX so you can feel better.
SPCX - $2T MC, $18B Annual Revenues, 100x P/S
Baba - $200B MC, $148B annual Revenues, 1.5x P/S
At $90's, today is a gift
\-Leader in Robotics AI LLM
\-Rising leader in AI chips
\-Top LLM overall/cheaper than anthropic's
\-#1 ecom in china (FCF in perpetuity - think "Amazon of China")
\-#1 cloud in asia (again, think "Amazon of China"), high margins and growing fast
\-QWEN = 1B+ users
\-You get the Ant Financial business for free ($732M record profits FY2026)
Normally I'd be selling covered calls for profits, but I don't want to miss out the explosive upside when we re-rate and all the sellers are shaken out.
Buying the dip today
I expect we go down to $60's first before we rocket back up to $150's. Let all the weak hands shake out. Michael Burry will sell at the bottom.