Apple vs Alibaba Which Is More Reliable?

Apple and Alibaba are two tech giants that have captured the attention of investors worldwide. Both companies have seen significant growth in their stock prices in recent years, with Apple dominating the global smartphone market and Alibaba leading the e-commerce sector in China. Investors are constantly comparing the performance of these two companies, as they both have a strong track record of revenue growth and innovation. Understanding the differences and similarities between Apple and Alibaba stocks can provide valuable insights for investors looking to diversify their portfolios.

Apple or Alibaba?

When comparing Apple and Alibaba, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Apple and Alibaba.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Apple has a dividend yield of 0.4%, while Alibaba has a dividend yield of 3.01%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Apple reports a 5-year dividend growth of -19.56% year and a payout ratio of 16.25%. On the other hand, Alibaba reports a 5-year dividend growth of 0.00% year and a payout ratio of 54.40%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Apple P/E ratio at 40.16 and Alibaba's P/E ratio at 18.25. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Apple P/B ratio is 66.10 while Alibaba's P/B ratio is 1.65.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Apple has seen a 5-year revenue growth of 0.82%, while Alibaba's is 2.38%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Apple's ROE at 137.87% and Alibaba's ROE at 8.88%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $246.24 for Apple and $87.24 for Alibaba. Over the past year, Apple's prices ranged from $164.08 to $250.80, with a yearly change of 52.85%. Alibaba's prices fluctuated between $66.63 and $117.82, with a yearly change of 76.83%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.