Wedbush Analyst Sees Recent Downtrend In Alibaba Shares As Related To Short Selling

Speaking exclusively to Benzinga, Wedbush analyst Gil Luria said even after last week's 13F filings showed hedge funds are loving Alibaba Group Holding Ltd BABA stock, they are now comfortable with taking short positions in the name. Shares of Alibaba hit an all-time high of $120 on November 13, but have since fallen down to the $110 level, Luria pointed out. Given both the rapid price increase in Alibaba shares and the fact that enough time has passed since the company's initial public offering, Luria believes funds may be drawing investors to the short side. “The multiple has gone to the very high end, and that usually attracts short attention,” he said. Since there hasn't been any significant negative news about the company, Luria expects to see a lot more scrutiny of the business and its flaws going forward.