Alibaba Group’s (NYSE: BABA) Taobao, along with four other e-commerce platforms, including Pinduoduo (NASDAQ: PDD), and JD.com (NASDAQ: JD), has been summoned by a consumer protection organization in China’s Zhejiang Province, Reuters reported.
According to the source, the companies were summoned due to live-streaming irregularities during the Singles’ Day shopping festival. Notably, ByteDance’s Douyin, the Chinese version of TikTok, and the video-sharing mobile app Kuaishou were also summoned.
Reasons Behind Summon
According to the consumer protection organization, around 30% of live-streamers showed irregularities during the Singles’ Day festival, while almost 40% of the products sold during the event did not meet national standards.
Additionally, the Cyberspace Administration of China (CAC) revealed that online platforms, including social media networks and video-sharing sites, will be thoroughly scrutinized to reduce deception on the internet.
Wall Street’s Take
Recently, Daiwa analyst John Choi reiterated a Buy rating on Alibaba but lowered the price target to $170 (43.27% upside potential) from $195.
Consensus among analysts is a Strong Buy based on 22 Buys versus 3 Holds. The average Alibaba price target of $203.65 implies 71.62% upside potential from current levels. However, shares have lost 46.6% over the past year.
TipRanks’ Website Traffic Tool, which uses data from SEMrush Holdings (NYSE: SEMR), the world’s biggest website usage monitoring service, offers insight into Alibaba’s performance this quarter. According to the tool, the Alibaba website recorded a 10.13% decrease in global visits in November compared to the same period last year. Also, a quarter-to-date comparison showed a decline of 3.76% compared to Q3 2021, while year-to-date website traffic growth stands at 1.67%.