Alibaba Group Holding Ltd (NYSE:BABA) share buyback boost could kickstart a wave of such returns by cash-rich Chinese internet firms, triggering investor curiosity, Bloomberg reports.
Baidu Inc (NASDAQ: BIDU), JD.com Inc (NASDAQ: JD), Xiaomi Corp (OTC: XIACY), and Tencent Holdings Ltd (OTC: TCEHY) shares rallied after Alibaba expecting more share buybacks at scale by the Chinese technology giants.
A Forsyth Barr Asia Ltd analyst saw Tencent and Xiaomi buying back their shares post results given their past practice.
Alibaba held $46 billion in cash as of the latest quarter. Tencent and JD.Com could also use their surplus cash for buybacks and boost the value of stocks that have nearly halved in value since their peak last February.
Reducing cash positions would also help minimize excessive liquidity reducing concerns over their ability to utilize capital.
In the U.S., Apple Inc (NASDAQ:AAPL), Meta Platforms Inc (NASDAQ:FB), and Microsoft Corp (NASDAQ:MSFT) also expanded their repurchase program by $90 billion in 2021 and bought back over $20 billion worth of stock in each of its recent quarters.
Price Action: BABA shares traded higher by 12% at $115.68 on the last check Tuesday.
