Alibaba Group Holding Limited BABA is set to unveil its fourth-quarter fiscal 2024 results on May 14.
Analysts predict revenues to reach $30.59 billion, showing a 1% increase from the previous year.
Expected earnings are at $1.24 per share, a 20.5% drop from the prior year. However, estimates have risen by 3.4% in the last month.
In the past four quarters, Alibaba’s earnings topped estimates thrice with an average positive surprise of 10.3%.
Analysis of Alibaba’s Performance
Alibaba’s domestic business may suffer due to economic challenges in China, affecting Taobao and Tmall Group performance.
Consumer spending slowdown could further impact their operations.
Despite these challenges, the international sector, especially the Trendyol e-commerce division, is anticipated to provide a positive outlook.
Investments in new initiatives, along with competition from local and global e-commerce players, might pose challenges for Alibaba in this quarter.
However, the company’s cloud services, including advanced technologies like AI and Machine Learning, are likely to continue driving growth.
Earnings Projection
Analysts are cautious about Alibaba’s earnings beat this quarter. With a Zacks Rank #5 (Strong Sell) and an Earnings ESP of +4.96%, the odds seem unfavorable.
It’s important to note that a combination of positive Earnings ESP and a Zacks Rank of #1, #2, or #3 typically enhances the likelihood of surpassing earnings estimates.
Stocks to Watch
Aside from Alibaba, other stocks worth considering include NVIDIA, Abercrombie & Fitch, and Costco Wholesale, which exhibit potential for earning beats this season.
NVIDIA is expected to release its first-quarter fiscal 2025 results on May 22, with a significant earnings growth projection.
Abercrombie & Fitch and Costco Wholesale are also slated to report their earnings at the end of May, with positive estimations for both companies.
Investors can stay informed about upcoming earnings announcements using resources like the Zacks Earnings Calendar.
