The latest trading session saw Alibaba (BABA – Free Report) ending at $84.95, denoting a +0.19% adjustment from its last day’s close. The stock’s performance was ahead of the S&P 500’s daily loss of 0.22%. Meanwhile, the Dow experienced a drop of 0.36%, and the technology-dominated Nasdaq saw a decrease of 0.16%.
The the stock of online retailer has fallen by 0.16% in the past month, leading the Retail-Wholesale sector’s loss of 1.69% and the S&P 500’s loss of 2.36%.
Analysts and investors alike will be keeping a close eye on the performance of Alibaba in its upcoming earnings disclosure. The company is forecasted to report an EPS of $3.03, showcasing a 13.48% upward movement from the corresponding quarter of the prior year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $38.54 billion, up 5.09% from the year-ago period.
BABA’s full-year Zacks Consensus Estimates are calling for earnings of $9.30 per share and revenue of $138.26 billion. These results would represent year-over-year changes of +7.89% and +5.95%, respectively.
Investors might also notice recent changes to analyst estimates for Alibaba. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, there’s been no change in the Zacks Consensus EPS estimate. At present, Alibaba boasts a Zacks Rank of #3 (Hold).
Digging into valuation, Alibaba currently has a Forward P/E ratio of 9.12. This represents a discount compared to its industry’s average Forward P/E of 20.75.
Also, we should mention that BABA has a PEG ratio of 0.38. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. The Internet – Commerce industry currently had an average PEG ratio of 1.21 as of yesterday’s close.
The Internet – Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 69, putting it in the top 28% of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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