Alibaba Group (NYSE:BABA) and InterCloud Systems (OTCMKTS:ICLD) are both retail/wholesale companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, institutional ownership, profitability, valuation and earnings.

Profitability

This table compares Alibaba Group and InterCloud Systems’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alibaba Group 23.17% 12.72% 7.76%
InterCloud Systems N/A N/A N/A

Valuation and Earnings

This table compares Alibaba Group and InterCloud Systems’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Alibaba Group $56.15 billion 7.43 $13.10 billion $3.59 45.69
InterCloud Systems $34.52 million 0.01 -$44.33 million N/A N/A

Alibaba Group has higher revenue and earnings than InterCloud Systems.

Analyst Recommendations

This is a breakdown of current recommendations for Alibaba Group and InterCloud Systems, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alibaba Group 0 0 24 1 3.04
InterCloud Systems 0 0 0 0 N/A

Alibaba Group currently has a consensus target price of $219.35, indicating a potential upside of 33.72%. Given Alibaba Group’s higher possible upside, analysts plainly believe Alibaba Group is more favorable than InterCloud Systems.

Insider & Institutional Ownership

41.1% of Alibaba Group shares are held by institutional investors. 12.5% of Alibaba Group shares are held by company insiders. Comparatively, 0.5% of InterCloud Systems shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility & Risk

Alibaba Group has a beta of 2.3, suggesting that its share price is 130% more volatile than the S&P 500. Comparatively, InterCloud Systems has a beta of 2.99, suggesting that its share price is 199% more volatile than the S&P 500.

Summary

Alibaba Group beats InterCloud Systems on 11 of the 12 factors compared between the two stocks.

Alibaba Group Company Profile

Alibaba Group Holding Limited, through its subsidiaries, operates as an online and mobile commerce company in the People's Republic of China and internationally. The company operates in four segments: Core Commerce, Cloud Computing, Digital Media and Entertainment, and Innovation Initiatives and Others. It operates Taobao Marketplace, a mobile commerce destination; Tmall, a third-party platform for brands and retailers; Rural Taobao program that enables rural residents and businesses to sell agricultural products to urban consumers; 1688.com, an online wholesale marketplace; Alibaba.com, an online wholesale marketplace; AliExpress, a retail marketplace; Lazada, an e-commerce platform; and Lingshoutong, a digital sourcing platform. The company also provides pay-for-performance and display marketing services; and Taobao Ad Network and Exchange, a real-time bidding online marketing exchange in China; and digital payment and financial technology platform services. In addition, it offers cloud computing services, including elastic computing, database, storage, virtualization network, large scale computing, security, and management and application services, big data analytics, a machine learning platform, and Internet of Things and other service for enterprises; and payment and escrow services; and movies, TV drama series, online dramas, variety shows, news feeds, games, literature and music, and other areas through various content platforms, as well as develops and operates mobile browsers. Further, the company provides AutoNavi, a mobile digital map, navigation, and real-time traffic information; DingTalk, a proprietary enterprise communication and collaboration platform; and Tmall Genie, an AI-powered voice assistant, which helps consumers to shop, order local services, search for information, control smart appliances, and play interactive content. The company was founded in 1999 and is based in Hangzhou, the People's Republic of China.

InterCloud Systems Company Profile

InterCloud Systems, Inc. provides networking orchestration and automation for software-defined networking (SDN) and network function virtualization environments to telecommunications service provider and corporate enterprise markets in the United States and internationally. It operates through two segments, Applications and Infrastructure and Professional Services. The Applications and Infrastructure segment provides applications and services, including SDN training, SDN software development and integration, and vertical network function validation; and cabling and other field installations, as well as designs, engineers, installs, and maintains various types of Wi-Fi and DAS networks to enterprise customers. The Professional Services segment engages in the design and deployment of SDN and software-defined wide area networking solutions for enterprise and carrier accounts. The company is based in Shrewsbury, New Jersey.

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