New York University's Aswath Damodaran says he's now ready to buy shares of Chinese tech giant Alibaba , which he says looks undervalued. "A few months ago, I bought Tencent because I valued Alibaba and Tencent as a pair and I bought Tencent and I said 'well I think Alibaba is … decently priced but I'm avoiding it because it carries more of these other risks than Tencent does.' I think I'm ready to buy Alibaba right now actually," said Damodaran, who is also known as Wall Street's "Dean of Valuation." Shares of Alibaba have plunged in recent days amid a myriad of market concerns ranging from an earnings miss , ongoing regulatory headwinds as well as dampened global investor sentiment following the discovery of the omicron Covid variant . As of Thursday's close, Alibaba's U.S.-listed shares have plunged more than 27% since Nov. 16, two days before the Chinese tech giant announced its fiscal second-quarter earnings. Hong Kong-listed shares have not fared much better, plummeting more than 25% in the same period. Alibaba has "layers of risk that have nothing to do with the company," including questions over the firm's relationship with the Chinese government, and Damodaran said those concerns appear to be keeping the stock price down. "It's a solid company in terms of the businesses it's in," the professor of finance at NYU's Stern School of Business said. "At the prices at which it's trading, I think not withstanding all the worries about corporate governance and the Chinese government, I think it's well positioned to be a long-term investment." "Let me be quite clear — this is not the kind of stock you want to buy because you want to make money in the next three or six months," Damodaran said. "I'm going to buy and put it away in my portfolio because I think long term, it still has the business model to deliver the cash flows that will keep my investment going."
New York University's Aswath Damodaran says he's now ready to buy shares of Chinese tech giant Alibaba, which he says looks undervalued.