Alibaba Group Holding Limited (NYSE: BABA) and Cnova NV (NASDAQ:CNV) are both retail/wholesale companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, risk, institutional ownership, profitabiliy, earnings, dividends and valuation.

Profitability

This table compares Alibaba Group Holding Limited and Cnova NV’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alibaba Group Holding Limited 27.51% 15.40% 9.71%
Cnova NV -3.30% N/A -6.49%

Volatility & Risk

Alibaba Group Holding Limited has a beta of 2.64, suggesting that its share price is 164% more volatile than the S&P 500. Comparatively, Cnova NV has a beta of 2.64, suggesting that its share price is 164% more volatile than the S&P 500.

Institutional and Insider Ownership

36.6% of Alibaba Group Holding Limited shares are owned by institutional investors. Comparatively, 3.0% of Cnova NV shares are owned by institutional investors. 12.5% of Alibaba Group Holding Limited shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations for Alibaba Group Holding Limited and Cnova NV, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alibaba Group Holding Limited 1 3 30 1 2.89
Cnova NV 0 1 0 0 2.00

Alibaba Group Holding Limited presently has a consensus target price of $140.44, suggesting a potential downside of 8.41%. Given Alibaba Group Holding Limited’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Alibaba Group Holding Limited is more favorable than Cnova NV.

Earnings & Valuation

This table compares Alibaba Group Holding Limited and Cnova NV’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Alibaba Group Holding Limited $23.41 billion 16.57 $9.33 billion $2.49 61.58
Cnova NV N/A N/A N/A ($0.94) -5.64

Alibaba Group Holding Limited has higher revenue and earnings than Cnova NV. Cnova NV is trading at a lower price-to-earnings ratio than Alibaba Group Holding Limited, indicating that it is currently the more affordable of the two stocks.

Summary

Alibaba Group Holding Limited beats Cnova NV on 11 of the 11 factors compared between the two stocks.

About Alibaba Group Holding Limited

Alibaba Group Holding Limited is a holding company. Through its subsidiaries, the Company is engaged in online and mobile commerce through offering of products, services and technology that enable merchants, brands and other businesses to transform the way they market, sell and operate in the People’s Republic of China (China) and internationally. Its businesses consist of core commerce, cloud computing, mobile media and entertainment, and other innovation initiatives. Through investee affiliates, it also participates in the logistics and local services sectors. Retail commerce in China operated by the Company includes the China online commerce destination (Taobao Marketplace); the China third-party platform for brands and retailers (Tmall), and the sales and marketing platform for flash sales (Juhuasuan). Wholesale commerce in China operated by the Company includes the China domestic wholesale marketplace (1688.com) and the wholesale marketplace for global trade (Alibaba.com).

About Cnova NV

Cnova N.V. is an e-commerce company with its two markets in France and Brazil. The Company offers differentiated delivery and payment solutions. It operates through three segments: Cdiscount France, Cdiscount International and Cnova Brazil. The Cdiscount France segment is engaged in the retail sales of consumer products through Cdiscount.com and specialized Websites in France. The Cdiscount International segment is engaged in retail sales of consumer products through Websites created by Cdiscount S.A. (Cdiscount) outside of France. The Cnova Brazil segment is engaged in retail sales of consumer products through Websites in Brazil, including Extra.com.br, PontoFrio.com.br, CasasBahia.com.br, Barateiro.com.br, PartiuViagens.com.br, and wholesale activities and E-Hub. As of December 31, 2015, it offered over 29 million product offerings on its sites through its direct sales and marketplace businesses across various categories, such as consumer electronics, home appliances and computers.

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