Business

Alibaba’s $9 billion buyback spree hasn’t done much for the company’s stock.

Since the internet sector’s decline began, China’s Alibaba Group Holding Ltd. has spent more on share buybacks than any other company. However, this has had minimal effect on the stock’s performance.

Even after spending more than $9 billion on stock repurchases, the e-commerce behemoth’s shares are trading around 60% below last year’s high, according to Bloomberg’s calculations. On Tuesday, the Hangzhou-based company announced an intention to extend its buyback plan to $25 billion, marking the third increase since Beijing’s tech crackdown began in late 2020.

The stock’s poor performance underscores concerns about the impact of China’s crackdown, which has affected almost every aspect of Alibaba’s core business. It also reflects broader weakness in Chinese equities, which has been harmed by a new viral outbreak and weakening economic development.

To be sure, Alibaba’s stock rose as much as 9.8% to HK$108.80 in Hong Kong after the buyback was disclosed on Tuesday. However, this is still a far way from the HK$267 high hit in February of last year. According to figures provided by Bloomberg, the stock’s $450 billion losses are the second-largest in the world after those of its competitor Tencent Holdings Ltd.

About the author

mm

Kathy Lewis

Kathy Lewis is an all-around geek who loves learning new stuff every day. With a background in computer science and a passion for writing, she loves writing for almost all the sections of Editorials99.

Add Comment

Click here to post a comment