Alibaba (BABA) closed at $116.32 in the latest trading session, marking a +1.12% move from the prior day. The stock fell short of the S&P 500, which registered a gain of 1.66% for the day. Elsewhere, the Dow gained 1.19%, while the tech-heavy Nasdaq added 2.78%.
Prior to today's trading, shares of the online retailer had gained 17.39% outpaced the Retail-Wholesale sector's gain of 0.61% and the S&P 500's loss of 1.49%.
The upcoming earnings release of Alibaba will be of great interest to investors. The company is forecasted to report an EPS of $1.94, showcasing a 5.83% downward movement from the corresponding quarter of the prior year. In the meantime, our current consensus estimate forecasts the revenue to be $38.63 billion, indicating a 11.74% growth compared to the corresponding quarter of the prior year.
BABA's full-year Zacks Consensus Estimates are calling for earnings of $6.88 per share and revenue of $167.62 billion. These results would represent year-over-year changes of +76.86% and +15.28%, respectively.
It's also important for investors to be aware of any recent modifications to analyst estimates for Alibaba. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
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 last 30 days, the Zacks Consensus EPS estimate has moved 5.73% lower. As of now, Alibaba holds a Zacks Rank of #4 (Sell).
With respect to valuation, Alibaba is currently being traded at a Forward P/E ratio of 16.71. For comparison, its industry has an average Forward P/E of 16.71, which means Alibaba is trading at no noticeable deviation to the group.
Meanwhile, BABA's PEG ratio is currently 1.93. 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 was holding an average PEG ratio of 1.27 at yesterday's closing price.
The Internet - Commerce industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 181, which puts it in the bottom 27% 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.
To follow BABA in the coming trading sessions, be sure to utilize Zacks.com.
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Alibaba Group Holding Limited (BABA): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).