Alibaba Faces Complex Outlook Ahead of Earnings Report
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Should l Buy BABA?
Source: NASDAQ.COM
- Weak Revenue Growth: In the first half of fiscal 2025 (ended September 30), Alibaba's cloud revenue rose by 30% year-over-year, while its e-commerce segments grew by 12% and 14%, respectively; however, a 27% decline in smaller business revenue resulted in only a 3% overall revenue increase to nearly $70 billion, highlighting structural vulnerabilities.
- P/E Ratio Comparison: Alibaba's P/E ratio stands at 22, significantly lower than Amazon's 28 and Southeast Asian peer Sea Limited's 47; although this is an increase from last summer's 12, the stock's attractiveness has diminished in the current market context.
- Investor Confidence Fluctuations: While Jack Ma's return has bolstered investor confidence, Alibaba has missed earnings estimates in three of the last four quarters, and the upcoming earnings report could impact stock performance, necessitating caution among investors.
- Intensifying Market Competition: Despite easing geopolitical risks, Alibaba faces a challenging competitive landscape, and given Amazon's stability, investors may prefer to consider other more attractive investment options.
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Analyst Views on BABA
Wall Street analysts forecast BABA stock price to rise
14 Analyst Rating
13 Buy
1 Hold
0 Sell
Strong Buy
Current: 158.730
Low
172.00
Averages
203.66
High
230.00
Current: 158.730
Low
172.00
Averages
203.66
High
230.00
About BABA
Alibaba Group Holding Ltd is an investment holding company mainly engaged in the provision of technology infrastructure and marketing platforms. The Company operates its business through nine segments. The China Commerce Retail segment is engaged in the China commerce retail business. The China Commerce Wholesale segment is mainly engaged in the operation of 1688.com. The Cloud Intelligence segment provides cloud services. The International Commerce Retail segment provides customer management services, sales of goods and logistics services. The International Commerce Wholesale segment is mainly engaged in the operation of Alibaba.com. The Cainiao Represents Logistics Services segment provides fulfilment services. The Local Services segment’s revenue includes platform commissions, logistics services revenue. The Digital Media and Entertainment segment engages in the operation of Youku and Alibaba. The All Others segment is mainly engaged in the Sun Art, Freshippo and other business.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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