Alibaba (BABA) Stock Looks for a Bounce After Trade Related Selloff

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Alibaba Group (BABA) reports its fiscal first-quarter numbers before the market open August 15. The Chinese internet giant is forecast to earn $1.51 per share versus $1.22 during the same period last year. BABA stock has appreciated 16.6% on the year.

Technical Analysis

BABA stock was recently trading at $159.79 down $35.93 from its 12-month high and $30.02 above its 12-month low. InvestorsObserver’s Stock Score Report gives BABA a 50 long-term technical score and a 38 short-term technical score. The stock has recent support above $150 and recent resistance below $180. Of the 22 analysts who cover the stock 19 rate it Strong Buy, 2 rate it Buy, 1 rate it Hold, 0 rate it Sell, and 0 rate it Strong Sell, BABA gets a score of 62 from InvestorsObserver’s Stock Score Report.

Analysts' Thoughts

BABA stock got off to a very strong start to 2019, but shares have been hit twice during the year as trade tensions between the U.S. and China escalated. The first sell off came in May and then again over the last two weeks as Wall Street’s expectations for a trade deal between the countries faltered. Alibaba has grown rapidly over the last five years as the largest e-commerce site in China, but analysts expect earnings growth to slow down dramatically to just 3.5% per annum over the next five years. The company does have a solid track record of posting positive earnings surprises, and it will need to continue posting positive surprises considering how low the growth estimates are at this time. The street expects a small earnings miss for Q1 and has already priced in a whisper number of $1.49 for a negative surprise of two cents. An in-line or better than expected number will give the stock a boost, but shares will likely continue trading in sympathy to developments in trade negotiations between the two countries. Analysts have an average price target of $220 on the stock.

About Alibaba Group Holding Limited American Depositary Shares each representing one

Alibaba is the world's largest online and mobile commerce company, measured by GMV (CNY 5.7 trillion/$846 billion for the fiscal year ended March 2019). It operates China's most-visited online marketplaces, including Taobao (consumer-to-consumer) and Tmall (business-to-consumer). Alibaba's China marketplaces accounted for 68% of revenue in fiscal 2019, with Taobao generating revenue through advertising and other merchant data services and Tmall deriving revenue from commissions. Additional revenue sources include international retail/wholesale marketplaces (7%), cloud computing (7%), digital media and entertainment platforms (6%), Cainiao logistics services (4%), and innovation initiatives/other (1%). Mobile GMV accounted for roughly 85% of consolidated GMV in fiscal 2018.

  • Last Price:
  • Previous Close:
  • Change:
    $7.80 (4.67%)
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  • Market Capitalization:
    $455.0 B
  • Day's Range:
    $168.57 - $177.55
  • Dividend Yield:
  • 52-week Range:
    $196 - $129.77
  • P-E:
  • EPS:
  • Earnings Date:
    not available
  • Ex Dividend Date:
  • Sector:
    Consumer Cyclical
  • Industry:
    Specialty Retail
  • Analyst Average Recommendation:
    Strong Buy

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