Alibaba (BABA) Exceeds Market Returns: Some Facts to Consider

Core Viewpoint - Alibaba's stock has shown significant growth recently, outperforming major indices, and upcoming earnings are anticipated to reflect positive growth in both EPS and revenue [1][2][3]. Financial Performance - Alibaba's stock closed at $112.78, with a daily increase of 1.31%, surpassing the S&P 500's gain of 0.03% [1]. - The company is expected to report an EPS of$ 3.08 for the upcoming quarter, representing a 15.36% increase year-over-year, with revenue forecasted at $38.19 billion, indicating a 4.14% growth [2]. - For the entire year, the Zacks Consensus Estimates predict earnings of$ 8.72 per share and revenue of $137.23 billion, reflecting changes of +1.16% and +5.16% respectively compared to the previous year [3]. Analyst Estimates - Recent modifications to analyst estimates for Alibaba indicate evolving short-term business trends, with positive revisions suggesting confidence in the company's performance [4]. - The Zacks Rank system, which reflects these estimate changes, currently ranks Alibaba at 3 (Hold), with a recent downward shift of 0.63% in the EPS estimate [5][6]. Valuation Metrics - Alibaba's Forward P/E ratio stands at 12.77, which is a discount compared to the industry average of 21.96 [7]. - The company has a PEG ratio of 0.42, significantly lower than the Internet-Commerce industry's average PEG ratio of 1.13 [7]. Industry Context - The Internet-Commerce industry, part of the Retail-Wholesale sector, holds a Zacks Industry Rank of 65, placing it in the top 26% of over 250 industries [8].