Alibaba Could Rally Another 15% on Jack Ma’s Return

Disclaimer: This post does not constitute financial advice. Author has no position in Alibaba . Do your own due diligence before making an investment.

Jack Ma has made his first public appearance in three months.

He appeared via video link to speak at a philanthropic event, where he praised China’s teachers. The sigh of relief from BABA investors could be heard around the globe. Ma’s whereabouts and health were the subject of quite a bit of speculation over the last few months.

This was his first public appearance since Oct. 24th, 2020, where he gave a financial speech in Shanghai. Regulators were not pleased, and the crackdown was swift. It was only a few days later when Ma and two Ant executives were dragged into a closed-door meeting with said regulators. Then, on Nov 3rd, Ant called off their $34 billion IPO.

It appears nobody, not even billionaires, are above the financial regulators in China. Ma decided it was best to lay low for a while.

This isn’t the first time something like this has happened to the rich and famous in China. Famous Chinese actress Fan Bingbing, vanished from the public eye for several months after being accused of tax evasion. When she reappeared, she gave a public apology, and paid $127.4 million (US) in penalties and taxes.

BABA shares rallied as much 8% in early trading on January 20th. Here’s a six-month chart.

Clearly there is a quite a bit of upside left. Shares peaked in October around $317. BABA is currently trading around $266. So, there’s still some room to run there. Although it’s unknown how badly Ma has damaged his relationship with Chinese regulators. His appearance today to praise Chinese teachers suggests he is attempting to repair that relationship.

The investigation that regulators began into Alibaba for anticompetitive behavior has not yet concluded. If it’s closed without incident, it’s reasonable to expect a monster rally. Even a multi-million dollar fine would still be great news as long as everyone chills out and gets back to business.