Alibaba Group Holding Ltd (NYSE: BABA ) and Baidu Inc (ADR) (NASDAQ: BIDU ) are two of the hottest Chinese internet stocks right now. BIDU stock is up more than 16% year to date, and BABA stock has soared more than 74% this year.
Understanding what works on the web in the US, and who the winners will be, is tough enough. In China, it's a whole other egg roll.
But if you can pick one or two leaders and study their sales and earnings trends over several quarters, you can begin to understand the different players and business models and make some sound investment choices to gain access to the largest middle class on the planet.
That's what I did with Alibaba this year and it has turned into a big winner for my TAZR Trader portfolio.
I wish I had been more diligent and studied a couple of other companies as well. Like the big competitor to Baidu who has crushed them in both growth and stock appreciation in the past few years.
I talk about all these companies in the video attached to this article. And I also explain why Weibo, which is over 45% owned by Sina, another media-search-social platform, rocketed 20% higher in May and is on the move again.
Why BABA Stock Is a Long-Term Buy
And I give many details about why BABA's growth is real and sustainable. It is rightly called the "Amazon of China" and will find few competitors, with its closest being the $61 billion online shopping portal JD.Com, Inc (ADR) (NASDAQ: JD ).
The secret lies in something that founder and CEO Jack Ma revealed in his tour of the US last month. And his seat at the table this week for the US-China Business Leaders Summit at the US Department of Commerce wasn't just a token gesture. Ma co-chaired the inaugural event alongside Blackstone CEO Stephen Schwarzman.
Be sure to watch my video to learn about that secret as well as see some great analysis tools on Zacks.com to compare all these companies, including the gaming platform NetEase NTES which is growing revenues 35% this year to $7.7 billion.
Disclosure: I own BABA shares for the Zacks TAZR Trader portfolio.
Kevin Cook is a Senior Stock Strategist for Zacks Investment Research where he runs the TAZR Trader as well as the Healthcare Innovators portfolio.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.