Yahoo Finance Alibaba (BABA) Outpaces Stock Market Gains: What You Should Know
Alibaba (BABA) closed the most recent trading day at $168.80, moving +0.21% from the previous trading session. This change outpaced the S&P 500's 0.12% gain on the day. Meanwhile, the Dow lost 0.08%, and the Nasdaq, a tech-heavy index, added 0.54%.
Heading into today, shares of the online retailer had gained 5.38% over the past month, lagging the Retail-Wholesale sector's gain of 6.02% and outpacing the S&P 500's gain of 3.68% in that time.
BABA will be looking to display strength as it nears its next earnings release. On that day, BABA is projected to report earnings of $1.44 per share, which would represent year-over-year growth of 18.03%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $16.52 billion, up 35.13% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $6.42 per share and revenue of $74.48 billion, which would represent changes of +12.24% and +33.92%, respectively, from the prior year.
Any recent changes to analyst estimates for BABA should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. BABA is currently sporting a Zacks Rank of #2 (Buy).
Valuation is also important, so investors should note that BABA has a Forward P/E ratio of 26.24 right now. For comparison, its industry has an average Forward P/E of 27.57, which means BABA is trading at a discount to the group.
Meanwhile, BABA's PEG ratio is currently 0.98. 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 1.84 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 70, 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.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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