Alibaba Stock Buyback Gathers Pace, $22BN Still On Deck

Alibaba stock (NYSE:BABA) has been on a rally, with gains of 54.16% on a YTD being driven in part by an acceleration that has gripped Chinese stocks since the news of stimulus incoming from the world's second largest economy.

It will be well received by the bulls then that the company continues to hold a warchest for stock buybacks of $22 billion as per the latest report from Alibaba, highlighting details of their buyback program.

Alibaba has significantly stepped up its stock repurchase program in 2024, buying back a substantial number of shares in each of the past quarter's. The global online retail giant bought back 52 million of the US listed American depositary shares (ADSs), spending a total of $4.1 billion for the quarter ending September 30. For a YoY comparison, in Q3 of 2023, the firm invested $1.7bn to repurchase 17 million ADS shares, as the firm doubles down on the dollar amount over the year so far.

Following this aggressive buyback activity, Alibaba's total ordinary shares in circulation have been reduced to 2,327 million ADSs on the New York Stock Exchange.

The company's buyback announcement has coincided with BABA's price reaching multi year highs. This event comes as part of a larger upward trend, with the stock surging more than 40% in the past month, and half of that gain coming in the past week.

Analysts attribute the rally in Chinese equities to proactive government measures aimed at propping up the economy. These include interest rate cuts, increased liquidity for financial institutions, support for equities, easing of home-buying restrictions, and reductions in mortgage rates. These government actions have imparted substantial momentum to the stocks, significantly boosting investor confidence.

It is worth noting, however, that during this period of heightened activity, mainland markets in China remained closed for a holiday until October 8.

As Alibaba continues to execute its buyback program and the Chinese government introduces economic stimuli, investors are witnessing a period of robust performance in the Chinese stock market, with Alibaba leading the way with its remarkable share repurchase achievements.