Alibaba (BABA) Dips More Than Broader Markets: What You Should Know
In the latest trading session, Alibaba (BABA) closed at $146.65, marking a -1.44% move from the previous day. This move lagged the S&P 500's daily loss of 0.55%. At the same time, the Dow lost 0.5%, and the tech-heavy Nasdaq lost 0.42%.
Prior to today's trading, shares of the online retailer had lost 8.8% over the past month. This has was narrower than the Retail-Wholesale sector's loss of 9.29% and lagged the S&P 500's loss of 5.71% in that time.
Wall Street will be looking for positivity from BABA as it approaches its next earnings report date. This is expected to be November 2, 2018. The company is expected to report EPS of $1.13, down 12.4% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $12.65 billion, up 52.65% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $5.41 per share and revenue of $57.07 billion. These totals would mark changes of +3.24% and +48.93%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for BABA. 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.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable 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. Within the past 30 days, our consensus EPS projection has moved 6.01% lower. BABA is currently a Zacks Rank #3 (Hold).
Valuation is also important, so investors should note that BABA has a Forward P/E ratio of 27.53 right now. This represents a premium compared to its industry's average Forward P/E of 26.97.
It is also worth noting that BABA currently has a PEG ratio of 0.8. 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. The Internet - Commerce was holding an average PEG ratio of 2.18 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 71, which puts it in the top 28% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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Alibaba Group Holding Limited (BABA) : Free Stock Analysis Report
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