Alibaba Shows Resilience Amid Market Turbulence and Trade Tensions
On Liberation Day, financial markets experienced a significant sell-off on Thursday. This downturn primarily stemmed from large retaliatory tariffs impacting nearly every US trading partner, with China at the center of the conflict. While Canada and Mexico have also become primary targets under the 2nd Trump Administration, one Chinese company has notably excelled this year. Despite the market pressure, this company has found robust technical support at the 50-day moving average and is poised to climb higher.
That company is today’s Bull of the Day, Alibaba (BABA). Alibaba Group Holding Limited provides a technology infrastructure and marketing reach that aids various businesses, including merchants and retailers, in connecting with users in China and globally. The company operates through seven segments: China Commerce, International Commerce, Local Consumer Services, Cainiao, Cloud, Digital Media and Entertainment, and Innovation Initiatives and Others.
Analyst Optimism Fuels Earnings Estimate Increases
The positive Zacks Rank stems from two analysts raising their earnings projections for this year and the next. As a result, the Zacks Consensus Estimate for the current year has increased from $8.72 to $8.80, while the estimate for next year rose from $10.24 to $10.83.
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This leads to a current-year earnings growth estimate of 2.09%, with projected growth swelling to 23% next year. Revenue growth is forecast at 5.97% this year and 6.55% the following year. The resurgence of Alibaba’s stock can be attributed to these increases in earnings estimates. A review of the Price, Consensus, and EPS Surprise Chart shows a notable earnings surge starting in mid-2024. Several consecutive earnings beats have enabled the stock to stabilize around $100, despite the recent drop from $148 to the 50-day moving average near $129.
Insight into Promising Stocks
In light of recent market activity, experts have distilled a list of seven elite stocks from the current roster of 220 Zacks Rank #1 Strong Buys. These stocks are considered “Most Likely for Early Price Pops.”
Since 1988, the entire list has outperformed the market by more than 2X, averaging a gain of +23.9% per year. Interested investors should pay immediate attention to these selected stocks.
For the latest recommendations from Zacks Investment Research, you can download the report titled 7 Best Stocks for the Next 30 Days. Click to access this free report.
Alibaba Group Holding Limited (BABA): Free stock analysis report.
This article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
