Alibaba Group Holding Limited (NYSE:BABA) will be looking to display strength as it nears its next earnings release
Alibaba (BABA) closed the most recent trading day at $168.80, moving +0.21% from the previous trading session. This change outpaced the S&P 500’s 0.12% gain on the day. Meanwhile, the Dow lost 0.08%, and the Nasdaq, a tech-heavy index, added 0.54%.
Heading into today, shares of the online retailer had gained 5.38% over the past month, lagging the Retail-Wholesale sector’s gain of 6.02% and outpacing the S&P 500’s gain of 3.68% in that time.
BABA will be looking to display strength as it nears its next earnings release. On that day, BABA is projected to report earnings of $1.44 per share, which would represent year-over-year growth of 18.03%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $16.52 billion, up 35.13% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $6.42 per share and revenue of $74.48 billion, which would represent changes of +12.24% and +33.92%, respectively, from the prior year.
Any recent changes to analyst estimates for BABA should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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 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 of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. BABA is currently sporting a Zacks Rank of #2 (Buy).
Valuation is also important, so investors should note that BABA has a Forward P/E ratio of 26.24 right now. For comparison, its industry has an average Forward P/E of 27.57, which means BABA is trading at a discount to the group.
Meanwhile, BABA’s PEG ratio is currently 0.98. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. The Internet – Commerce was holding an average PEG ratio of 1.84 at yesterday’s closing price.
Overall, the bias in prices is: Sideways.
The projected upper bound is: 178.84.
The projected lower bound is: 158.03.
The projected closing price is: 168.43.
A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 22 white candles and 28 black candles for a net of 6 black candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 26.7176. This is not an overbought or oversold reading. The last signal was a sell 18 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 52.01. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 24 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -48. This is not a topping or bottoming area. The last signal was a sell 2 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 22 period(s) ago.
Rex Takasugi – TD Profile
ALIBABA GRP ADR closed up 0.350 at 168.800. Volume was 33% below average (neutral) and Bollinger Bands were 11% narrower than normal.
Open High Low Close Volume___
166.900 168.980 166.500 168.800 2,405,188
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 171.09 167.82 163.18
Volatility: 31 39 43
Volume: 3,474,627 4,370,125 3,897,243
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
ALIBABA GRP ADR is currently 3.4% above its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of BABA.N at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on BABA.N and have had this outlook for the last 13 periods.