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The most recent trading session ended with Alibaba (BABA) standing at $81.68, reflecting a +1.42% shift from the previouse trading day's closing. This move outpaced the S&P 500's daily gain of 0.12%. Meanwhile, the Dow experienced a rise of 0.52%, and the technology-dominated Nasdaq saw a decrease of 0.23%.
The online retailer's stock has dropped by 6.41% in the past month, falling short of the Retail-Wholesale sector's loss of 4.43% and the S&P 500's loss of 3.45%.
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 $3.06 per share. This would mark year-over-year growth of 14.61%. Simultaneously, our latest consensus estimate expects the revenue to be $38.46 billion, showing a 4.88% escalation compared to the year-ago quarter.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $8.78 per share and revenue of $137.85 billion. These totals would mark changes of +1.86% and +5.63%, respectively, from last year.
Any recent changes to analyst estimates for Alibaba should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 6.22% lower. Alibaba currently has a Zacks Rank of #3 (Hold).
From a valuation perspective, Alibaba is currently exchanging hands at a Forward P/E ratio of 9.18. This signifies a discount in comparison to the average Forward P/E of 20.64 for its industry.
It is also worth noting that BABA currently has a PEG ratio of 0.38. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As of the close of trade yesterday, the Internet - Commerce industry held an average PEG ratio of 1.18.
The Internet - Commerce industry is part of the Retail-Wholesale sector. At present, this industry carries a Zacks Industry Rank of 141, placing it within the bottom 44% of over 250 industries.