Alibaba, Tencent Need to Deliver on Their Riskiest Bets in Years
- Two Chinese giants’ trade at higher multiples than Facebook
- Their shares have outpaced the much-hyped FAANG stocks
Elinor Leung, head of Asia telecom and internet research at CLSA, previews Alibaba and Tencent earnings being released later this week. She speaks on 'Bloomberg Daybreak: Australia.' (Corrects guest's title in description.) (Source: Bloomberg)
Alibaba and Tencent can count themselves among the world’s costliest technology companies after a stellar run. To justify those lofty valuations, China’s two largest corporations have to deliver on some of the riskiest bets they’ve placed in years.
Alibaba Group Holding Ltd., which created China’s largest online bazaar but has scant brick-and-mortar experience, spent $8 billion investing in a string of retailers including Suning Commerce Group Co. to prove it can transform old-school shopping. Tencent Holdings Ltd. is extending a gaming empire built around social phenomenon WeChat, buying studios and creating content to evolve into an entertainment powerhouse. Those multibillion-dollar bets come under the microscope when both report earnings this week.