Alibaba (BABA - Free Report) closed at $185.78 in the latest trading session, marking a +1.48% move from the prior day. This change outpaced the S&P 500's 0.05% gain on the day. At the same time, the Dow added 0.26%, and the tech-heavy Nasdaq gained 0.3%.
Prior to today's trading, shares of the online retailer had gained 0.68% over the past month. This has lagged the Retail-Wholesale sector's gain of 4.01% and the S&P 500's gain of 3.08% 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 May 15, 2019. The company is expected to report EPS of $1.04, up 14.29% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $13.50 billion, up 36.69% from the year-ago period.
It is also important to note the recent changes to analyst estimates for BABA. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for 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 7.57% lower. BABA currently has a Zacks Rank of #4 (Sell).
Looking at its valuation, BABA is holding a Forward P/E ratio of 28.72. For comparison, its industry has an average Forward P/E of 29.69, which means BABA is trading at a discount to the group.
Investors should also note that BABA has a PEG ratio of 1.16 right now. 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. Internet - Commerce stocks are, on average, holding a PEG ratio of 2.14 based on yesterday's closing prices.
The Internet - Commerce industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 202, which puts it in the bottom 21% 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.