Shares in Chinese tech giants saw muted gains after strong economic data releases. Alibaba Group Holding Ltd. is continuing its attempt to unlock value from its sprawling business with another planned spinoff. David Herro, manager of the $19.7 billion Oakmark International fund, discusses the possible effect of China’s economic slump on luxury stocks he owns. The industry with the best average Zacks Rank would be considered the top industry (1 out of 265), which would place it in the top 1% of Zacks Ranked Industries. The industry with the worst average Zacks Rank (265 out of 265) would place in the bottom 1%.
MarketRank is calculated as an average of available category scores, with extra weight given to analysis and valuation. Regulators in Beijing have said that China may be willing to ease up on restrictions surrounding data. That means that tech companies wouldn’t have to worry about as strict of rules when it comes to transferring data between countries. Only those with the temperament to handle these additional risks and the patience to wait for the company to execute its latest strategies should consider buying the stock. Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
- Prior to today’s trading, shares of the online retailer had lost 8.7% over the past month.
- These returns cover a period from January 1, 1988 through September 4, 2023.
- Moreover, COVID-related constraints have significantly affected China’s economy.
- He preaches diversification and shares investment ideas across all market sectors.
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Also, there may be a limit to how much selling could occur in Alibaba’s stock. This stock has been battered senselessly for about two years, and seller exhaustion could be setting in. Alibaba’s stock should life of a trader stabilize around current levels, recover, and move higher as we advance. 15 Wall Street equities research analysts have issued «buy,» «hold,» and «sell» ratings for Alibaba Group in the last year.
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Peak to trough ($320-$58), Alibaba’s stock declined by a staggering 82%. The e-commerce giant is trading like the company is going out of business, while nothing could be further from the truth. The recent $58 low is around Alibaba’s post-IPO low in 2015 and marks a highly shallow point for the company’s stock price. We also saw the CCI fall below -200 and the RSI dip below 30 recently, illustrating oversold technical conditions.
- We also saw the CCI fall below -200 and the RSI dip below 30 recently, illustrating oversold technical conditions.
- Relatively modest revenue and EPS growth coupled with mild P/E ratio expansion should enable Alibaba’s share price to increase substantially in future years.
- Yahoo Finance Live anchors Seana Smith and Brad Smith report the latest financial news for September 22, 2023.
- Zacks Earnings ESP (Expected Surprise Prediction) looks to find companies that have recently seen positive earnings estimate revision activity.
- Reducing drastic government-imposed measures benefits the Chinese economy and should help improve Alibaba’s price action as we move on.
Alibaba has clarified that these changes are routine business registration adjustments at the subsidiary level and do not impact the broader group structure. Alibaba Group’s earnings are expected to grow from $8.20 per share to $8.96 per share in the next year, which is a 9.27% increase. In most cases the # of brokers listed forex scalping strategy above is less than the # of brokerage firms that have a recommendation on the stock. That is because some firms prohibit Zacks from displaying detailed information on their recommendations such as in the upgrade/downgrade table. Of the 15 recommendations deriving the current ABR, 13 are Strong Buy and one is Buy.
China Investors Look For Silver Lining During National Golden Week To Boost Consumer Spending Amid Country’s Property Turmoil
As an investor, you want to buy stocks with the highest probability of success. That means you want to buy stocks with a Zacks Rank #1 or #2, Strong Buy or Buy, which also has a Score of an A or a B in your personal trading style. The Style Scores are a complementary set of indicators to use alongside the Zacks Rank.
News and Social Media Coverage
Moreover, despite the optimistic tone from Chinese authorities, U.S. regulators could still decide to delist Alibaba. Also, Alibaba’s profitability could continue to struggle for various reasons. This investment has numerous risks, and shares are very cheap right now. I believe Alibaba remains an elevated-risk/high-reward investment, and investors should carefully examine the risks before opening a position in Alibaba stock. Relatively modest revenue and EPS growth coupled with mild P/E ratio expansion should enable Alibaba’s share price to increase substantially in future years. Despite staying at a forward P/E ratio of 18 or lower, Alibaba’s stock price could appreciate to roughly $500 by the end of this decade.
Such a performance was unacceptable for a company that depended on e-commerce for most of its revenue and all of its profitability . 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 vegan companies to invest in of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Alibaba Group saw a increase in short interest in the month of September. As of September 15th, there was short interest totaling 44,600,000 shares, an increase of 8.1% from the August 31st total of 41,260,000 shares.
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Understandably, the stock trades at a low valuation with the stock trading at a price-to-sales (P/S) ratio of 1.8, significantly lower than its five-year average of 5.5. Alibaba will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $2.15, up 18.13% from the prior-year quarter.
It allows the user to better focus on the stocks that are the best fit for his or her personal trading style. The company is scheduled to release its next quarterly earnings announcement on Thursday, November 16th 2023. Victor Dergunov is an independent investor and author with 20 years experience. He preaches diversification and shares investment ideas across all market sectors. Victor aims to help readers build portfolios that perform well in all economic conditions. In addition to healthy EPS growth, revenue growth should persist, and the company’s sales will probably move much higher in future years.
Key Earnings Data
EPS estimates may be too low now, and the company should continue outperforming estimates as we advance. China’s Singles Day shopping festival just ended, and Alibaba got a big piece of the pie. It’s important to mention that Singles Day dwarfs Black Friday and Cyber Monday in terms of sales volume. This dynamic should reflect positively on China’s biggest e-commerce platform. As of this writing, Alibaba’s stock trades at around $86, just 26% above its initial public offering (IPO) price in 2014. Yet, the conglomerate’s revenue has grown 15-fold in this period, from $8.4 billion in to $126 billion in 2023.
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Recent stocks from this report have soared up to +178.7% in 3 months – this month’s picks could be even better. The Zacks Industry Rank gauges the strength of our individual 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.
Still, a complete reversal of the business trajectory will not take place overnight. On the contrary, it will take at least a few quarters, if not years, for the new management team to execute a complete turnaround to get Alibaba back on its high-growth trajectory. Meanwhile, the logistics arm, Cainiao, is advancing towards a separate initial public offering in Hong Kong, which aims to raise over $1 billion. Just don’t get so caught up in the past that you forget stocks reflect a company’s likely future. SAN FRANCISCO–(BUSINESS WIRE)– #alibaba–PingSafe, the only CNAPP platform powered by attacker intelligence, today announced its support for Alibaba Cloud and Oracle Cloud.
The monthly returns are then compounded to arrive at the annual return. Only Zacks Rank stocks included in Zacks hypothetical portfolios at the beginning of each month are included in the return calculations. Certain Zacks Rank stocks for which no month-end price was available, pricing information was not collected, or for certain other reasons have been excluded from these return calculations. Alibaba also supports the infrastructure of the Internet with a range of products and services that include computing, storage, network, security, database, big data, and IoT connectivity.