Alibaba (BABA) closed the most recent trading day at $179.45, moving +2.72% from the previous trading session. This change outpaced the S&P 500's 1.23% gain on the day. Elsewhere, the Dow gained 0.72%, while the tech-heavy Nasdaq added 1.86%.
Heading into today, shares of the online retailer had gained 1.62% over the past month, outpacing the Retail-Wholesale sector's loss of 1.39% and lagging the S&P 500's gain of 2.45%.
The investment community will be closely monitoring the performance of Alibaba in its forthcoming earnings report. In that report, analysts expect Alibaba to post earnings of $0.66 per share. This would mark a year-over-year decline of 69.3%. Meanwhile, the latest consensus estimate predicts the revenue to be $34.43 billion, indicating a 2.17% increase compared to the same quarter of the previous year.
BABA's full-year Zacks Consensus Estimates are calling for earnings of $6.57 per share and revenue of $144.67 billion. These results would represent year-over-year changes of -27.08% and +4.73%, respectively.
Investors might also notice recent changes to analyst estimates for Alibaba. Such recent modifications usually signify the changing landscape of near-term business trends. 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 exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 16.33% downward. At present, Alibaba boasts a Zacks Rank of #5 (Strong Sell).
Digging into valuation, Alibaba currently has a Forward P/E ratio of 26.58. This represents a premium compared to its industry average Forward P/E of 23.26.
We can additionally observe that BABA currently boasts a PEG ratio of 2.09. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Internet - Commerce was holding an average PEG ratio of 1.47 at yesterday's closing price.
The Internet - Commerce industry is part of the Retail-Wholesale sector. This industry, currently bearing a Zacks Industry Rank of 88, finds itself in the top 36% echelons of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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Alibaba Group Holding Limited (BABA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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