There is an end to everything. Sorry, we didn’t mean it to sound tragic. On Tuesday, Alibaba Group announced the departure of Daniel Zhang, who will step down from his positions as chairman and chief executive in September. Zhang has been Alibaba’s chairman since 2019, taking over that position from co-founder Jack Ma, and has been the company’s CEO since 2015. Under Zhang's leadership, Alibaba's share price experienced both record highs and lows.
After his resignation, the company will remain in good hands. Eddie Yongming Wu, the chairman of Alibaba's Taobao and Tmall Group, will assume the CEO position, while Joseph Tsai, the Executive Vice Chairman, will take over as chairman from Zhang. However, this fact couldn’t prevent Alibaba stock from falling by 1.95%, in line with a 1.6% decline in the benchmark index (HSI).
Nearly three months ago, Alibaba disclosed its plans to split the company into six business groups, each with the ability to seek external funding and go public. Zhang intends to stay in Alibaba, but he will mainly focus on Alibaba Cloud Intelligence Group, the digital technology and intelligence backbone of the group. The company aims to spin off and publicly list this division within 12 months.
It seems the stock market will enrich with new players seeking investors’ attention. Both novice and experienced investors should rely on various tools to aid their decision-making process. For instance, by utilizing stock screener, traders can narrow down their focus to a select group of stocks that meet their desired parameters.
According to analysts, the cloud unit's value is estimated to range from $41 billion to $60 billion. However, they have expressed concerns that the vast amount of data managed by the unit could attract regulatory attention. Over the past three years, Alibaba has faced mounting regulatory scrutiny from the Chinese government, which has had a negative impact on the company's stock price.
Analysts have a median target price forecast for Alibaba Group Holding Ltd of 138.62 over the next 12 months, representing a projected increase of 59.76% compared to the current price of 86.68.
Here we should leave a friendly reminder. If you are going to step into trade, conducting a personal analysis is crucial. This is rule #1 which every trader should stick to.