Alibaba is China's leading e-commerce firm. (Photo : Getty Images)
After attending Alibaba's investor day conference, Oppenheimer analysts have increased their confidence over the leading Chinese e-commerce firm, noting that other investors have been getting the company wrong, Yahoo Finance reported.
Oppenheimer and Co. Inc. is a U.S.-based "leading investment bank and full-service investment firm that provides financial services and advice to high net-worth investors, individuals, businesses and institutions," as its website description said.
In a note issued on July 6, Oppenheimer analysts have raised their price target from $100 per share to $110. Stock currently trades at $79 per share.
Though Alibaba is often described as essentially the eBay or Amazon of China, experts take note that there is much more to the e-commerce platform than Internet retail.
Analysts remarked that Alibaba's great potential lies on its 33-percent stake in Ant Financial, one of the world's most powerful Internet finance industry players.
At present, the firm gets 37.5 percent of Ant Financial's pre-tax net income and has the option to convert it to a 33-percent equity stake once the latter becomes publicly available.
The financial firm's most recent capital raise has increased its value to $60 billion, which means Alibaba's stake is now worth around $20 billion.
Oppenheimer also regarded Cainao, a logistics network that Alibaba uses and currently owns 47 percent of, as another asset.
Currently delivering 40 million packages on a daily basis, with a mere 1,200 employees, the firm is exhibiting a hyper-efficient business model. The network further eyes to reach 100 million packages a day in the future.
Lastly, Oppenheimer analysts emphasized the potential they see in Alibaba's cloud computing unit, AliCloud. They expect an average growth of 126 percent for the next three years, a figure higher than the usual expectation set by other experts, which is at 94 percent.
Oppenheimer's prediction means that AliCloud's revenue will shoot up by at least 10-fold for the next three years.
Analysts base this forecast from AliCloud's current standing as China's leading cloud computing provider--it has a 62-percent market share. It also lists diverse customers, from small and big businesses to government organizations.
Commenting on Alibaba's counterfeiting issue, Oppenheimer believes that the matter is only a legacy problem in China, adding that the firm is doing intensified efforts to crack down on fake items on its online marketplaces.
