Finance

Analyzing the Insider Data for Alibaba Group Holding Limited (BABA)

Recent insider trends for Alibaba Group Holding Limited (NYSE:BABA) have caught the attention of investors. Insider data is useful because it can reveal what a company’s executives and largest shareholders feel about a stock. In this case, the data has some interesting things to say about how BABA might perform in the future.

Institutions own 37.58% of Alibaba Group Holding Limited (BABA)’s shares. The total value of these holdings, in millions, is $177,768. Among active positions in the latest quarter, 590 holders increased their positions by a total of 106.9 million shares, 324 holders decreased the positions by a total of 63.15 million shares, and 123 holders held their positions. This works out to a net increase in ownership of 43.75 million shares, and suggests that institutions are feeling bullish about the stock.

Among new and sold out positions, 165 holders initiated new positions by a total of 25.15 million shares and 60 holders exited their positions by a total of 5.82 million shares. This nets out to an increase of 19.33 million shares and is a bullish sign for BABA.

Insider ownership increased by a total of 0 shares, which suggests that BABA’s key executives are feeling more optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: ownership increased by a net of 0 shares.



Short interest is another tool that analysts use to gauge investor sentiment. It represents the number of a stock’s shares that are being shorted by investors. Alibaba Group Holding Limited (NYSE:BABA)’s short interest is 134.31 million shares, or % of the float. This represents a decrease of -4% in the number of shares being shorted compared to the previous reading, and implies that investors felt less pessimistic about the stock during the past two weeks.

Given what the insider ownership patterns are saying, it makes sense to consider the technicals to see if these pieces of information reach the same conclusion about the outlook for BABA. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that BABA is a Strong buy, which implies that BABA is expected to outperform the market based on prior trading patterns.

Conclusion




Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bullish. Technical indicators (also) suggest that Alibaba Group Holding Limited (NYSE:BABA) is undervalued.

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