Alibaba (BABA) Stock Sinks As Market Gains: What You Should Know

In the latest trading session, Alibaba (BABA) closed at $152.03, marking a -0.08% move from the previous day. This change lagged the S&P 500's daily gain of 0.22%. Elsewhere, the Dow gained 0.7%, while the tech-heavy Nasdaq added 0.08%.

Heading into today, shares of the online retailer had gained 15.36% over the past month, outpacing the Retail-Wholesale sector's gain of 12.32% and the S&P 500's gain of 9.27% in that time.

Wall Street will be looking for positivity from BABA as it approaches its nex t earnings report date. This is expected to be January 30, 2019. In tha t report , analysts expect BABA to post earnings of $1.65 per share. This would mark year-over-year growth of 1.23%. Our most recent consensus estimate is calling for quarterly revenue of $17.30 billion, up 35.56% from the year-ago period.

BABA's full-year Zacks Consensus Estimates are calling for earnings of $5.21 per share and revenue of $55.15 billion. These results would represent year-over-year changes of -0.57% and +43.91%, respectively.

Investors might also notice recent changes to analyst estimates for BABA. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.57% higher within the past month. BABA is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that BABA has a Forward P/E ratio of 29.21 right now. This represents a discount compared to its industry's average Forward P/E of 29.63.

We can also see that BABA currently has a PEG ratio of 0.99. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Internet - Commerce stocks are, on average, holding a PEG ratio of 2.07 based on yesterday's closing prices.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 95, putting it in the top 38% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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