ZACKS·2025-12-26 23:46Core Viewpoint - Alibaba's stock performance has been underwhelming compared to the broader market, with a notable decline in its recent earnings estimates indicating potential challenges ahead [1][2][6]. Financial Performance - In the latest trading session, Alibaba closed at $152.24, reflecting a +1.45% change from the previous day, which outperformed the S&P 500's loss of 0.03% [1]. - The company is expected to report an EPS of $2.24, representing a 23.55% decrease from the same quarter last year, while revenue is forecasted at $41.33 billion, showing a 7.67% increase year-over-year [2]. - For the entire fiscal year, earnings are projected at $6.42 per share, down 28.75% from the prior year, with revenue expected to reach $146.08 billion, up 5.75% [3]. Analyst Estimates - Recent adjustments to analyst estimates for Alibaba reflect changing short-term business dynamics, with positive revisions indicating analysts' confidence in the company's performance [4]. - The Zacks Consensus EPS estimate has decreased by 2.83% over the last 30 days, and Alibaba currently holds a Zacks Rank of 5 (Strong Sell) [6]. Valuation Metrics - Alibaba is trading at a Forward P/E ratio of 23.36, which is higher than the industry average Forward P/E of 19 [7]. - The company has a PEG ratio of 2.08, compared to the Internet - Commerce industry's average PEG ratio of 1.46 [7]. Industry Context - The Internet - Commerce industry, part of the Retail-Wholesale sector, ranks in the top 33% of all industries according to the Zacks Industry Rank [8].