Alibaba Shares Drop 2.7% as Q1 EPS Seen Falling 34.8%
Alibaba shares slid 2.66% to close at $144.11, underperforming the S&P 500’s 0.43% loss and recording a 15.04% decline over the past month. Analysts forecast Q1 EPS of $1.91 (-34.8%) on $41.26 billion revenue (+7.5%) and assign Alibaba a forward P/E of 24.8X, PEG 2.88X, and a sell rating.
1. Stock Performance
Alibaba closed at $144.11 after a 2.66% drop, trailing the S&P 500’s 0.43% loss, the Dow’s 1.05% slide and Nasdaq’s 0.92% decline. Over the past month, the stock has fallen 15.04%, underperforming the Retail-Wholesale sector’s 5.44% loss and the S&P 500’s 0.5% retreat.
2. Earnings Estimates
For the upcoming quarter, consensus projects earnings per share of $1.91, down 34.81% year-over-year, on revenue of $41.26 billion, up 7.49% from last year. Full-year estimates call for EPS of $5.96 (-33.85%) and revenue of $147.73 billion (+6.95%), reflecting mixed top- and bottom-line trends.
3. Valuation and Rating
Alibaba trades at a forward P/E of 24.84X versus the industry average of 15.88X and carries a PEG ratio of 2.88X compared to the Internet-Commerce average of 0.94X. The company holds a sell rating, reflecting recent estimate downgrades and its Zacks Industry Rank in the bottom 29% of 250+ industries.