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What You Need to Know Ahead of Alibaba's (BABA) Q2 Earnings
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Alibaba Group Holding Limited (BABA - Free Report) is scheduled to report second-quarter fiscal 2024 results on Nov 16.
For the fiscal second quarter, the Zacks Consensus Estimate for revenues is pegged at $31.01 billion, suggesting a 6.5% rise from the year-ago fiscal quarter’s reported figure.
The Zacks Consensus Estimate for earnings is pinned at $2.11 per share, indicating growth of 15.9% from the prior-year fiscal quarter’s reported figure. The figure has moved 2.3% south in the past 30 days.
Earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 18.2%.
Alibaba Group Holding Limited Price and EPS Surprise
Alibaba’s solid momentum across the China and international commerce retail businesses are likely to have aided the performance of Taobao and Tmall Group and International Digital Commerce Group, respectively.
Growing online physical goods GMV at Taobao and Tmall and increasing merchant spending on advertisements might have benefited the China commerce retail business during the fiscal second quarter. Strength in the consumer electronics category might have been a plus.
The well-performing Trendyol e-commerce business is likely to have contributed to the performance of the International commerce retail division during the quarter under review. Strength across Lazada and AliExpress is expected to have been another positive.
Apart from e-commerce, strong momentum across domestic consumer logistics services and international fulfillment solution services is expected to have benefited the Cainiao Smart Logistics Network segment during the quarter under review.
Solid online entertainment and improving offline entertainment businesses are likely to have aided the fiscal second quarter performance of Digital Media and Entertainment Group.
Its robust cloud segment is expected to have sustained its momentum in the to-be-reported quarter, with strength among customers in the financial services, education, electric power and automobile industries.
However, increasing macroeconomic challenges in China are expected to have hurt Alibaba’s prospects in the fiscal second quarter.
What Our Model Says
Our proven model doesn’t conclusively predict an earnings beat for Alibaba this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here, as elaborated below.
BABA currently has a Zacks Rank #3 and an Earnings ESP of -3.88%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some stocks worth considering, as our model indicates they have the right combination of elements to beat on earnings this season.
Image: Bigstock
What You Need to Know Ahead of Alibaba's (BABA) Q2 Earnings
Alibaba Group Holding Limited (BABA - Free Report) is scheduled to report second-quarter fiscal 2024 results on Nov 16.
For the fiscal second quarter, the Zacks Consensus Estimate for revenues is pegged at $31.01 billion, suggesting a 6.5% rise from the year-ago fiscal quarter’s reported figure.
The Zacks Consensus Estimate for earnings is pinned at $2.11 per share, indicating growth of 15.9% from the prior-year fiscal quarter’s reported figure. The figure has moved 2.3% south in the past 30 days.
Earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 18.2%.
Alibaba Group Holding Limited Price and EPS Surprise
Alibaba Group Holding Limited price-eps-surprise | Alibaba Group Holding Limited Quote
Factors to Consider
Alibaba’s solid momentum across the China and international commerce retail businesses are likely to have aided the performance of Taobao and Tmall Group and International Digital Commerce Group, respectively.
Growing online physical goods GMV at Taobao and Tmall and increasing merchant spending on advertisements might have benefited the China commerce retail business during the fiscal second quarter. Strength in the consumer electronics category might have been a plus.
The well-performing Trendyol e-commerce business is likely to have contributed to the performance of the International commerce retail division during the quarter under review. Strength across Lazada and AliExpress is expected to have been another positive.
Apart from e-commerce, strong momentum across domestic consumer logistics services and international fulfillment solution services is expected to have benefited the Cainiao Smart Logistics Network segment during the quarter under review.
Solid online entertainment and improving offline entertainment businesses are likely to have aided the fiscal second quarter performance of Digital Media and Entertainment Group.
Its robust cloud segment is expected to have sustained its momentum in the to-be-reported quarter, with strength among customers in the financial services, education, electric power and automobile industries.
However, increasing macroeconomic challenges in China are expected to have hurt Alibaba’s prospects in the fiscal second quarter.
What Our Model Says
Our proven model doesn’t conclusively predict an earnings beat for Alibaba this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here, as elaborated below.
BABA currently has a Zacks Rank #3 and an Earnings ESP of -3.88%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some stocks worth considering, as our model indicates they have the right combination of elements to beat on earnings this season.
Costco Wholesale (COST - Free Report) has an Earnings ESP of +4.26% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Costco is set to announce its first-quarter fiscal 2024 results on Dec 14. COST shares have gained 29.6% year to date.
Synopsys (SNPS - Free Report) has an Earnings ESP of +0.94% and a Zacks Rank #2.
Synopsys is set to announce its fourth-quarter fiscal 2023 results on Nov 29. SNPS shares have declined 24.9% year to date.
Snowflake (SNOW - Free Report) has an Earnings ESP of +67.33% and a Zacks Rank #2.
Snowflake is set to announce its third-quarter fiscal 2024 results on Nov 29. SNOW shares have gained 86% year to date.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.