Alibaba (BABA  ) has been in the news for all the wrong reasons. The company got into trouble when CEO and founder Jack Ma was critical of their treatment of AliPay.

At its core, regulators were looking at AliPay as a financial company that should have capital reserves and regulations around lending, while Ma saw AliPay as a tech company. The fallout for Ma and the company has been severe as AliPay's valuation was severely deflated as the company was forced to make changes to its business model.

Shares fell further following its earnings results that were weak in terms of earnings but strong in other respects.

Inside the Numbers

In its fiscal fourth quarter, Alibaba reported EPS of $1.58 per share which was less than expectations of $1.79 per share. However, revenue came in at $28.6 billion, topping expectations of $27.8 billion.

The company also reached a milestone in reaching 1 billion active customers with 240 million outside of China. Over the last year, the company has gained 85 million customers and 79 million mobile active users. In the quarter, it generated $1.2 trillion in gross merchandise volume.

One reason for the earnings miss was higher spending on growth initiatives. The company also paid a $2.8 billion antitrust fine to Chinese regulators for abusing its monopoly power over Chinese merchants. At the time, this seemed like the potential end of its ordeal and a catalyst for shares to start rising again.

However, this hasn't happened as shares have remained weak. In part, it's due to weakness for tech stocks, growth stocks, and Chinese stocks as the market has had a very risk-off sentiment over the last three months.

Stock Price Outlook

Alibaba is now down 24% from its recent highs. Over this time, the company has continued to maintain an impressive rate of revenue growth. It also has a leading and dominant position in many categories including cloud computing, ecommerce, AI, and fintech.

It also remains quite attractive on a fundamental basis with a forward PE of 18 and profit margins of 24.7%. The company's recent stumble is certainly concerning. And, it will certainly lose every time it tangles with government regulators.

The stumble is also what makes it possible to buy shares at a discount. Over time, the company will figure out ways to monetize and grow AliPay even with these constraints. And, it will continue its growth and dominance in ecommerce and cloud computing.