The most recent trading session ended with Alibaba (BABA) standing at $76.64, reflecting a +1.82% shift from the previouse trading day's closing. This change outpaced the S&P 500's 1.08% gain on the day. Elsewhere, the Dow saw an upswing of 0.32%, while the tech-heavy Nasdaq appreciated by 1.58%.
The online retailer's shares have seen an increase of 2.17% over the last month, surpassing the Retail-Wholesale sector's loss of 0.31% and the S&P 500's gain of 0.43%.
The investment community will be closely monitoring the performance of Alibaba in its forthcoming earnings report. On that day, Alibaba is projected to report earnings of $2.24 per share, which would represent a year-over-year decline of 6.67%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $34.95 billion, up 8.22% from the year-ago period.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $8.20 per share and a revenue of $138.63 billion, indicating changes of -4.87% and +6.23%, respectively, from the former year.
Investors might also notice recent changes to analyst estimates for Alibaba. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.05% lower. As of now, Alibaba holds a Zacks Rank of #4 (Sell).
Looking at valuation, Alibaba is presently trading at a Forward P/E ratio of 9.18. Its industry sports an average Forward P/E of 21.16, so one might conclude that Alibaba is trading at a discount comparatively.
One should further note that BABA currently holds a PEG ratio of 0.39. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Internet - Commerce industry had an average PEG ratio of 1.04 as trading concluded yesterday.
The Internet - Commerce industry is part of the Retail-Wholesale sector. At present, this industry carries a Zacks Industry Rank of 60, placing it within the top 24% of over 250 industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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