Ryan Cohen targets Alibaba in his next activist campaign – The Average Joe
Business Economy Tech Subscribe About Us

    Ryan Cohen targets Alibaba in his next activist campaign


    January 17, 2023

    What comes to mind when you hear Ryan Cohen’s name? GameStop? Bed Bath & Beyond? If you’re blanking out, you need a bit more /r/WallStreetBets in your life.

    • Cohen was the unofficial leader of the GameStop mania — cheered on by an arm of degenerates.
    • He bought and sold $BBBY last year, reaping a massive 56% return.

    The meme stock king has his eyes on another kingdom — Alibaba (NYSE: BABA)accumulating hundreds of millions of dollars in the e-commerce giant’s stock.

    Positive news vibes — including China’s reopening and Jack Ma giving up control over Ant Group (partly owned by Alibaba) — have sent $BABA 80% higher since October.

    What’s driving his love? Could it be $BABA’s ~63% drop in share price from 2020’s high? Or does Cohen have a thing for struggling companies?

    He believes $BABA is undervalued — and that the company could hit “double-digit sales” and a 20% free-cash-flow growth over the next five years.

    Cohen is pushing Alibaba to move faster on its share repurchase plan — who announced $25B in buybacks last year.

    Good luck influencing Alibaba. It’s unlikely the communist Chinese government will let one US man dictate how China’s e-commerce giant is run. Cohen’s ambitions also have two main issues:

    • First, Alibaba’s North American shares use a variable interest entity structure, giving investors a share in profits but no “real” ownership, hence no say.
    • Recent news shows an undisclosed Chinese government entity took ‘golden shares’ in $BABA — which lets them control key decisions and handpick directors.

    Hao Hong, an economist at Grow Investment, has described Cohen’s actions as futile: “It’s unlikely for Ryan to move the dial…”

    Trending Posts