On Thursday, August 11th, Alibaba (NYSE:BABA) will release its Q1 FY17 earnings results. The company is currently a Zacks Rank #3 (Hold) and shares are up about 4.3% year-to-date.
Join David Bartosiak at 1pm on Wednesday, August 10, on YouTube. Dave will look into Alibaba’s past earnings, look at what is currently going on with the company, and gives us his thoughts on their upcoming earnings announcement.
Furthermore, Dave will look into some potential options trades for investors looking to make a play on Alibaba ahead of earnings.
Alibaba in Focus
Alibaba Group Holding Limited operates online and mobile marketplaces in retail and wholesale trade, as well as cloud computing and other services. It provides technology and services to enable consumers, merchants, and other participants to conduct commerce in its ecosystem. The Company operates Taobao Marketplace, an online shopping destination; Tmall, a third-party platform for brands and retailers; Juhuasuan, a group buying marketplace; Alibaba.com, an online business-to-business marketplace; 1688.com, an online wholesale marketplace; and AliExpress, a consumer marketplace. Alibaba Group Holding Limited is headquartered in Hangzhou, the People's Republic of China.
Alibaba is coming off of an earnings miss of 47.4% in its Q4 FY2016 earnings report, posting an EPS that was $0.18 lower than the Zacks Consensus Estimate.
BABA has an average EPS surprise of -10.4% for the last four quarters. In Q1, BABA missed estimates by 17%. BABA then went on to beat estimates in Q2 and Q3 by 18.75% and 4.29% respectively.
ALIBABA GROUP Price, Consensus and EPS Surprise
ALIBABA GROUP Price, Consensus and EPS Surprise | ALIBABA GROUP Quote
Heading into this earnings report, our Most Accurate Estimate for Alibaba is $0.49, $0.11 higher than the Zacks Consensus Estimate.
In terms of gross merchandise volume (GMV), Alibaba is China’s largest e-commerce company. It has faced some controversy around the listing of fake items on the company’s services, but claims to be working towards addressing the issue.
Although China’s economic growth rate has decreased, the company was able to increase revenue last quarter to 39% year-over-year. However, the continued slowdown could still affect GMV this quarter. Even so, Alibaba expects to hit $1 trillion in GMV by 2020 and reach 2 billion customers in the process.
Recently, Alibaba has been working extensively to expand its international presence. As part of this initiative, it plans on opening its first office in Melbourne, Australia, by the end of this year. Its rival JD.com has been eating at Alibaba’s market share due to its reputation as a vendor for foreign electronic goods.
Alibaba is expanding into other fields, notably teaming up with SAIC Motor to explore the connected car space. According to a CNBC report in July, the two will soon launch an SUV powered by Alibaba’s operating system, YunOS. Furthermore, Alibaba is investing in e-sports through its new partnership with the International e-Sports Federation, and plans to build multiple stadiums in China for e-Sports events.
Alibaba is also putting more money into its cloud services and payment platform, Alipay, which face competition from Tencent and other smaller companies.
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Dave Bartosiak is the editor of the Momentum Trader and Home Run Investor service. He has over a decade of experience in the financial services industry. He has traded forex, futures, stocks, and options. Mr. Bartosiak is a frequent guest on popular business news TV channels such as Bloomberg TV. He’s also the host of a light-hearted, Millennial-minded series of videos called “Trending Stocks.”
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
ALIBABA GROUP (BABA): Free Stock Analysis Report
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