Alibaba Now Has An Impressive Shareholder Yield

Summary:

  • Alibaba recently showed in a filing that it had bought back $275 million worth of stock in one week.
  • The data shown in the filing allows us to estimate BABA’s forward shareholder yield.
  • The historical dividends and buybacks provide a 6.87% shareholder yield. The forward yield using last week’s filings as a guideline is higher.
  • BABA’s dividends are modest, but its buybacks appear to be driving significant capital appreciation.
  • In this article, I explore why I’m as enthusiastic about Alibaba as I’ve ever been, in light of its high shareholder yield.
Multi exposure of virtual abstract financial graph interface on Chinese flag and sunset sky background, financial and trading concept

Multi exposure of virtual abstract financial graph interface on Chinese flag and sunset sky background, financial and trading concept

Igor Kutyaev

Alibaba Group Holding (NYSE:BABA) (OTCPK:BABAF) made the rounds on social media again Friday, as filings revealed that the company had repurchased $275 million worth of stock that week. The filings revealed that BABA’s buybacks continued apace

June quarter

March quarter

December quarter

September quarter

TTM total

Cash spent on buybacks

FCF remaining after buybacks

FCF

$2.39 billion

$2.1 billion

$7.9 billion

$6.1 billion

$18.49 billion

$18.086 billion

$404 million


Analyst’s Disclosure: I/we have a beneficial long position in the shares of BABA, PDD either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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