) — Alibaba Group Holding Ltd. could be the leader of the pack when it comes to reaching the coveted landmark of a $1 trillion market capitalization. This would be attainable for the company by 2020, according to MKM Partners analyst Rob Sanderson.
This would put the chinese e-commerce giant ahead of Apple Inc., Google parent company Alphabet Inc., Amazon Inc., Facebook Inc., and Tencent – Sanderson conveyed in a note.
While the current frontrunner for the first-place position is Apple, and could reach the pole position by 2019, he explained his reasoning: “We think it’s most likely 2021 when the barrier is broken by an Internet company, but think BABA may have the best chance for 2020 despite being the smallest of the mega-caps today.“
To achieve it, BABA would have to outperform the current consensus of 20% earnings in 2018, grow its EPS by 45% in 2019, reach an outlook for growth of 40% in 2020 andmaintain its 24 times forward price/equity ratio, he said.
Alibaba shares have gained 96% in 2017, thus outdoing the the S&P 500 index, which has gained 20%, by far.