Alibaba hasn't hit bottom yet: Barron's

The logo of Alibaba Group is seen inside the company's headquarters in Hangzhou, Zhejiang province early November 11, 2014. REUTERS/Aly Song

(Reuters) - Shares of Alibaba Group Holding Ltd <BABA.N>, which recently slipped below their initial offering price after having rocketed 75 percent in their first two months of trading, could lose another 50 percent of their value, Barron's said in the cover story of its Sept. 14 issue.

The reasons the weekly financial newspaper gave for the dour outlook: China's struggling economy, increasing competition in e-commerce and more scrutiny of the company's culture and governance.

Alibaba spokesman Bob Christie said the article "contains factual inaccuracies and selective use of information, and the conclusions the reporter draws are misleading." The company has posted on the internet a letter to Barron's editor complaining about the story.

The company runs two big retail websites and recently warned of lower-than-expected transaction volumes, after having reported that volume growth in the June quarter declined to 34 percent from the 50 percent-plus rates of the past.

"That may only worsen as China's economic growth drops to its lowest pace in six years," Barron's said.

The recent share price puts a market value on the company of $160 billion. But the stock is trading at about 25 times the average earnings estimate from analysts and Barron's said it should be closer to the 15 times multiple of eBay Inc <EBAY.O>.

Alibaba said in its letter that the price-earnings multiple comparison is flawed and a more appropriate comparison would be to Chinese peers rather than eBay, which does not operate in China.

(Reporting by David Henry in New York; Editing by Andrea Ricci and Nick Zieminski)