Here’s Why First Eagle Investments Continue to Like Alibaba (BABA)

First Eagle Investments is an independent, privately owned asset management firm dedicated to serving the needs of individuals and institutions worldwide as well as the financial professionals that advise them. Recently, the fund published its second-quarter 2022 investor letter – a copy of which can be downloaded here. The fund believes that the return to the conditions that prevailed in the aftermath of the Covid-19 swoon—namely, moderate inflation and a very low cost of capital—may be further away than some may think. Global Fund A Shares (without sales charge) posted a return of -10.49% in the second quarter 2022. Go over the fund’s top 5 positions to have a glimpse of its finest picks for 2022.

In its Q2 2022 investor letter, First Eagle Investments Global Fund mentioned Alibaba Group Holding Limited (NYSE:BABA) and explained its insights for the company. Founded in 1999, Alibaba Group Holding Limited (NYSE:BABA) is a Hangzhou, China-based e-commerce company with a $249.4 billion market capitalization. Alibaba Group Holding Limited (NYSE:BABA) delivered a -21.00% return since the beginning of the year, while its 12-month returns are down by -43.81%. The stock closed at $93.84 per share on August 30, 2022.

Here is what First Eagle Investments Global Fund has to say about Alibaba Group Holding Limited (NYSE:BABA) in its Q2 2022 investor letter:

“The shares of Chinese e-commerce giant Alibaba advanced on signs that the Chinese government may be starting to relax its regulatory crackdown on the technology sector. There have been reports that Beijing’s more accommodative stance may re-open the door to the initial public offering of Ant Group, a leading Chinese online payment platform whose planned 2020 IPO was scuttled by regulators. Alibaba owns about one-third of Ant. We continue to like Alibaba’s core assets, including its cloud business, which continues to generate strong cash flows.”

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Our calculations show that Alibaba Group Holding Limited (NYSE:BABA) ranks 13th on our list of the 30 Most Popular Stocks Among Hedge Funds. Alibaba Group Holding Limited (NYSE:BABA) was in 106 hedge fund portfolios at the end of the second quarter of 2022, compared to 100 funds in the previous quarter. Alibaba Group Holding Limited (NYSE:BABA) delivered a -2.30% return in the past 3 months.

In July 2022, we also shared another hedge fund’s views on Alibaba Group Holding Limited (NYSE:BABA) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q2 page.

Disclosure: None. This article is originally published at Insider Monkey.