Better Buy: Alibaba vs. Amazon
Amazon (NASDAQ: AMZN) has had a sluggish year in 2019. The stock has produced returns of just 17% thus far, which are uninspiring by its standards. By comparison, China-based Alibaba Group Holdings (NYSE: BABA) has gained 33%. The companies appear to be heading in opposite directions in terms of growth, and that's evident in their performances this year. However, let's take a closer look at which one is the better buy today.
In October, Amazon's share price took a hit when the company's quarterly results failed to meet expectations, and guidance for the upcoming holiday season was also not as strong as analysts had been hoping. Regardless of whether management is simply being cautious or actually believes that a slowdown will take place, investors have pushed pause on buying the stock for now.
While the company was still able to achieve strong revenue growth of 24% during the quarter, Amazon is spending lots to get it. Not only has it invested over $800 million in one-day shipping during each of the past two quarters, but it's expecting to spend another $1.5 billion in Q4. The company is also going to be spending more on its sales efforts. With so much growth planned, investors might have hoped for stronger guidance.
Source Fool.com
