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Here's Why Alibaba (BABA) Fell More Than Broader Market
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Alibaba (BABA - Free Report) closed the most recent trading day at $78, moving -0.79% from the previous trading session. This change lagged the S&P 500's 0.5% loss on the day. Meanwhile, the Dow experienced a rise of 0.5%, and the technology-dominated Nasdaq saw a decrease of 1.28%.
Coming into today, shares of the online retailer had gained 8.92% in the past month. In that same time, the Retail-Wholesale sector lost 1.37%, while the S&P 500 gained 0.1%.
Analysts and investors alike will be keeping a close eye on the performance of Alibaba in its upcoming earnings disclosure. The company is forecasted to report an EPS of $2.24, showcasing a 6.67% downward movement from the corresponding quarter of the prior year. Meanwhile, the latest consensus estimate predicts the revenue to be $34.95 billion, indicating an 8.22% increase compared to the same quarter of the previous year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $8.20 per share and revenue of $141.05 billion, which would represent changes of -4.87% and +8.08%, respectively, from the prior year.
Investors should also take note of any recent adjustments to analyst estimates for Alibaba. These revisions typically reflect the latest short-term business trends, which can change frequently. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.05% 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 9.59. This represents a discount compared to its industry's average Forward P/E of 20.04.
Meanwhile, BABA's PEG ratio is currently 0.41. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Internet - Commerce industry currently had an average PEG ratio of 1.12 as of yesterday's close.
The Internet - Commerce industry is part of the Retail-Wholesale sector. At present, this industry carries a Zacks Industry Rank of 61, placing it within the top 25% of over 250 industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Here's Why Alibaba (BABA) Fell More Than Broader Market
Alibaba (BABA - Free Report) closed the most recent trading day at $78, moving -0.79% from the previous trading session. This change lagged the S&P 500's 0.5% loss on the day. Meanwhile, the Dow experienced a rise of 0.5%, and the technology-dominated Nasdaq saw a decrease of 1.28%.
Coming into today, shares of the online retailer had gained 8.92% in the past month. In that same time, the Retail-Wholesale sector lost 1.37%, while the S&P 500 gained 0.1%.
Analysts and investors alike will be keeping a close eye on the performance of Alibaba in its upcoming earnings disclosure. The company is forecasted to report an EPS of $2.24, showcasing a 6.67% downward movement from the corresponding quarter of the prior year. Meanwhile, the latest consensus estimate predicts the revenue to be $34.95 billion, indicating an 8.22% increase compared to the same quarter of the previous year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $8.20 per share and revenue of $141.05 billion, which would represent changes of -4.87% and +8.08%, respectively, from the prior year.
Investors should also take note of any recent adjustments to analyst estimates for Alibaba. These revisions typically reflect the latest short-term business trends, which can change frequently. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.05% 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 9.59. This represents a discount compared to its industry's average Forward P/E of 20.04.
Meanwhile, BABA's PEG ratio is currently 0.41. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Internet - Commerce industry currently had an average PEG ratio of 1.12 as of yesterday's close.
The Internet - Commerce industry is part of the Retail-Wholesale sector. At present, this industry carries a Zacks Industry Rank of 61, placing it within the top 25% of over 250 industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.