Analyzing JD.com (JD) and Altaba (YHOO)
Altaba (NASDAQ: YHOO) and JD.com (NASDAQ:JD) are both large-cap technology companies, but which is the superior business? We will compare the two businesses based on the strength of their profitabiliy, dividends, institutional ownership, analyst recommendations, valuation, earnings and risk.
This table compares Altaba and JD.com’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Volatility & Risk
Altaba has a beta of 1.8, indicating that its stock price is 80% more volatile than the S&P 500. Comparatively, JD.com has a beta of 1.41, indicating that its stock price is 41% more volatile than the S&P 500.
This is a breakdown of current recommendations and price targets for Altaba and JD.com, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Altaba currently has a consensus target price of $47.48, suggesting a potential downside of 9.70%. JD.com has a consensus target price of $35.54, suggesting a potential downside of 10.56%. Given Altaba’s higher probable upside, analysts plainly believe Altaba is more favorable than JD.com.
Insider and Institutional Ownership
82.1% of Altaba shares are owned by institutional investors. Comparatively, 49.1% of JD.com shares are owned by institutional investors. 9.2% of Altaba shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Earnings and Valuation
This table compares Altaba and JD.com’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|JD.com||$41.18 billion||1.37||$479.24 million||($0.29)||-137.03|
JD.com has higher revenue and earnings than Altaba. Altaba is trading at a lower price-to-earnings ratio than JD.com, indicating that it is currently the more affordable of the two stocks.
Altaba beats JD.com on 7 of the 11 factors compared between the two stocks.
Altaba Inc. (the Fund), formerly Yahoo! Inc., is a non-diversified, closed-end management investment company. The Fund seeks to track the combined investment return of the Alibaba Shares and the Yahoo Japan Shares it owns. Alibaba Shares represent an approximate 15% equity interest in Alibaba Group Holding Limited (Alibaba), and its Yahoo Japan Corporation ((Yahoo Japa) Shares represent an approximate 36% equity interest in Yahoo Japan. In addition to the Alibaba Shares and the Yahoo Japan Shares, the Fund also owns the minority investments, all of the equity interests in Excalibur IP, LLC (which owns the Excalibur IP Assets) and the marketable debt securities portfolio. The Fund’s external investment advisors are BlackRock Advisors, LLC and Morgan Stanley Smith Barney LLC.
JD.com, Inc. is an online direct sales company. The Company engages in the sale of electronics and home appliance products and general merchandise products (including audio, video products and books) sourced from manufacturers, distributors and publishers in China on the Internet through its Website, www.jd.com. It also offers an online marketplace that enables third-party sellers to sell their products to customers on the Company’s Website. The Company operates through the provision of a single class of services for accelerating and improving the delivery of its products over the Internet. The Company also offers online and in-person payment options and customer services. The Company operates approximately 210 warehouses with an aggregate gross floor area of approximately four million square meters in over 50 cities. It operates over 5,370 delivery stations and pickup stations in approximately 2,350 counties and districts across China.
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