With Credit Suisse (NYSE:CS) predicting that China’s e-commerce market will more than quadruple by 2015, you can expect a lot of investors eager to capitalize on revenue growth that might be as high as 100+ percent per year. Here’s a short list of the Top 4 leading e-commerce sites in China per 247WallSt.
||% of online sales in China
||Site traffic rank in China
||Owned by Alibaba Group
||Owned by Tencent
Amazon.com, Inc. (NASDAQ:AMZN) also operates Joyo.com in China. The site currently has a traffic rank of 75 in China, according to Alexa.com. Speculation has been running high that Taobao.com and 360buy.com could IPO as early as this fall.
I’ve slowly started accumulated shares in what I see as the most under-valued tech stock in America: Yahoo! Inc (NASDAQ:YHOO). It’s not that I like Yahoo’s business model, but rather I like all the Asian pots that the company has its fingers in. Indeed, Yahoo’s locked away a 40 percent stake in what may be the hottest Internet property in the world right now: Alibaba Group.
A privately owned Web giant in China, Alibaba Group operates in just about every high-growth tech area in the country from cloud computing to payment processing (think Paypal), to online retail and international trade Web sites. The company also publishes Taobao.com, an eBay-like auction site that’s China’s third most-visited Web site, and an online classifieds site (similar to Craigslist) in Koubei.com.
As I wrote earlier, one writer at Fool.com values Yahoo’s Alibaba stake alone at more than Yahoo’s current market cap of $21.6 billion. Icing on the cake? Yahoo’s still the third most-visited Web site in the U.S. and the fourth most-visited Web site in the world. Revenue and net income declined at Yahoo during Q3, but analysts are expecting a better showing in Q4 with estimates around $0.22 per share.
No matter how uncertain the company’s future is, though, there’s no denying Yahoo’s got an incredible tech portfolio. And with rumors swirling that Alibaba Group may IPO later this year, Yahoo could cash in on what may be its best investment of all time. Buying shares in Yahoo, then, offers investors back-door access to a stake in Alibaba Group. And that’s worth as much as Yahoo is all on its own.
After a rocky year of trading, Yahoo! Inc. (NASDAQ:YHOO) shares finished 2010 with a loss of nearly 1 percent. Why buy into the tech company in 2011? Here are three compelling reasons to consider:
1) Yahoo owns 40 percent of one of the hottest tech properties in China in the Alibaba Group. Not only does the Alibaba Group own Taobao.com, a consumer-to-consumer online retail site that’s similar to eBay.com, they also run cloud computing services, a Paypal-like online payment gateway in Alipay, and a classified service in Koubei.com among other businesses. At least one writer at Fool.com values Yahoo’s Alibaba stake alone at more than Yahoo’s current market cap of $21.6 billion.
2) Yahoo owns 34.5 percent of Yahoo! Japan – a stake that’s worth at least $7 billion on top of the $20 billion+ that the company owns in the Alibaba Group. Yahoo.co.jp is the most-visited Web site in Japan, and it’s the 17th most-visited Web site in the world, per Alexa.com.
3) Yahoo is starting to look like a takeover target. The company’s stake in the Asian tech market has private equity investors and large American tech companies like eBay salivating. Acquiring Yahoo would not only give private equity or a large American tech company a foothold in Asia, but it would also give them control over what remains one of the most-visited Web sites in the U.S. People seem to forget that Yahoo remains the No. 3 Web site in the U.S. and the fourth most-visited Web site in the world.
While it may not have the glitz and glamor of other tech companies, Yahoo’s assets make it one of the most attractive tech stocks in the U.S. By the time investors realize it, it just might be too late.