Will Alibaba (BABA) Stock Get a Boost From Analysts' Confidence Regarding Singles' Day Sales?
NEW YORK (TheStreet) -- Alibaba Group Holding (BABA) - Get Report is preparing for Singles' Day, the biggest online shopping day of the year, and SunTrust Robinson Humphrey is optimistic about this year's sales.
Sales from Singles' Day, held on November 11, could generate $12 billion this year, according to SunTrust analysts, CNBC.com reports.
This outlook is higher than last year's sales of $9.3 billion.
In 2009, Alibaba's CEO Daniel Zhang created Singles' Day, where thousands of merchants from 25 different countries can sell their brands on the Chinese e-commerce's giant's online platform.
In celebration of this holiday, Alibaba announced earlier this morning that it will ring the New York Stock Exchange opening bell on Wednesday November 11 remotely from Beijing.
"This day is not just the largest shopping day in the world, but a demonstration of the scale and impact of our global ecosystem," Executive Chairman Jack Ma noted.
Alibaba shares are falling 2.46% to $81.55 on Monday morning.
Separately, TheStreet Ratings team rates ALIBABA GROUP HLDG as a Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:
We rate ALIBABA GROUP HLDG (BABA) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- BABA has underperformed the S&P 500 Index, declining 21.44% from its price level of one year ago. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
- ALIBABA GROUP HLDG reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This year, the market expects an improvement in earnings ($16.60 versus $1.59).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Internet Software & Services industry. The net income increased by 571.9% when compared to the same quarter one year prior, rising from $514.69 million to $3,458.36 million.
- Although BABA's debt-to-equity ratio of 0.28 is very low, it is currently higher than that of the industry average.
- The gross profit margin for ALIBABA GROUP HLDG is currently very high, coming in at 71.73%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 101.46% significantly outperformed against the industry average.
- You can view the full analysis from the report here: BABA