Alibaba’s e-commerce business is a cash cow that can self-finance growth initiatives, despite operating money-losing ventures. The company trades at a discount to the general market and has profitable bets like AI cloud hosting. With its ability to take financial risks, Alibaba is a gift that keeps on giving for shareholders.

Alibaba’s revenue heavily relies on Taobao and Tmall, which account for 45% of consolidated revenue and 113% of adjusted EBITDA. The company has a strong position in China’s online retail market, with Taobao focusing on consumer-to-consumer sales and Tmall on business-to-consumer transactions. Alibaba’s profitability allows it to invest in emerging industries like cloud intelligence.

Investors considering Alibaba stock should note that the company’s cash flow supports growth in new ventures, despite potential failures. The ability to self-finance future initiatives, improve per-share profitability, and conduct stock buybacks make Alibaba an attractive long-term investment. The Motley Fool recommends exploring other top stocks for potentially higher returns.

Read more at Nasdaq: 1 Reason I’m Never Selling Alibaba Stock