Brief China: China Housing: Cities Without Tiers – An Alternative Data Cut With Illuminating Patterns and more

In this briefing:

1. China Housing: Cities Without Tiers – An Alternative Data Cut With Illuminating Patterns
2. Alibaba (BABA): For Dec. Quarter, Focus on Profit Improvement, But Not Revenue Growth, 40% Upside

1. China Housing: Cities Without Tiers – An Alternative Data Cut With Illuminating Patterns

Beyond the aggregate figures, most investors interested in China housing markets would look at the breakdown by Tier. We introduce a few alternative ways to cut the house price growth data, illustrating some consistent patterns that could be more meaningful for any investment thesis than the simple by-tier.

2. Alibaba (BABA): For Dec. Quarter, Focus on Profit Improvement, But Not Revenue Growth, 40% Upside

• For the December quarter results, the market is focusing on the slowdown of the revenue growth, but we notice that the growth rate of operating profits recovered.
• In two of our previous reports, we mentioned BABA’s efforts on cost control in the second half of 2018. Now we can see the results.
• We believe the most important risk is the significant operating losses in the minor business “digital media”.
• The P/E band suggests that the stock price has an upside of 40%.