Alibaba (NYSE:BABA) stock is down 25% in 2021 but the company has multiple secular tailwinds that could be growth catalysts in 2021 and beyond. If you have the stomach for high-risk stocks, you need to keep an eye on Alibaba which could be an attractive bet for value, contrarian, and growth investors.Chinese companies, such as China’s e-commerce heavyweight Alibaba (BABA), that are listed on the U.S. stock exchanges have grossly underperformed the broader markets in 2021. For example, BABA's stock is down 25% in the first eight months of the year, while the S&P 500 has gained more than 20%.
Shares of BABA were already experiencing volatility after the IPO of its financial arm Ant Financial was canceled in 2020 by the country’s regulators. Alibaba was also fined almost $3 billion for its anti competitive practices, in April this year.
Recently, the Chinese government cracked down on several other tech companies including DiDi Global (DIDI) due to regulatory issues surrounding the tech space. China also announced that companies operating in the education space will not operate for profits that exacerbated this decline.