|

Alibaba Stock Forecast: BABA shares in turnaround mode after Singles Day record

  • 290,000 brands took part in Alibaba's Singles Day.
  • Alibaba's 13th Singles Day brought in a record $84.7 billion.
  • BABA stock kicker formation forecasts bullish reversal.

Despite much hoopla about regulatory woes and government obstinance, and the repeated certainty by critics that this year the event would be "muted," Alibaba (BABA) shares jumped on both Wednesday and Thursday on positive news regarding the e-commerce giant's Singles Day. At the time of writing, BABA shares are down 1.8% at $164.88 at the start of Friday's session.

Alibaba Stock News: Singles Day sales up 14%

Alibaba's Singles Day – the largest shopping day event of its kind in the world – brought in $84.7 billion in gross merchandise sales. This was 14% higher than last year, a time when BABA stock first began to slide after Chinese regulators put a halt to the IPO of ANT Financial, a one-time subsidiary.

This was the 13th year of the event. Though many critics focused on the sales growth slide of the event, the figures appear impressive since China is facing both a supply chain slowdown and a fall in consumer spending.

Last week, Alibaba Cloud unveiled both new custom proprietary servers for use at its data centers and in-house designed Yitian 710 server chips, as well as announcing the construction of two new data centers in Thailand and South Korea.

With less than one week before the next earnings results, Wall Street consensus has Alibaba reporting earnings per share (EPS) of $1.95 – 28% lower than the year prior – on revenue of just over $32 billion. That last figure should warm the hearts of some investors as it is a 36% gain YoY from the $23.5 billion in revenue reported in the same quarter last year.

BABA key statistics

Market Cap$453 billion
Price/Earnings18.9
Price/Sales3.6
Price/Book2.8
Enterprise Value$393.6 billion
Operating Margin13.7%
Profit Margin

19.3%

52-week high$319.32
52-week low$138.43
Short Interest2.7%
Average Wall Street Rating and Price TargetBuy 243.18

BABA Stock Technical Analysis: A kicker to boot

Alibaba stock had been trending down since the end of October in what seemed like a prolonged correction. BABA appears to have found its legs, however, on Wednesday, when the stock decided to go against the grain and open well above Tuesday's close. Thursday again showed another kicker candlestick that opened above the high on Wednesday. This is significant since Wednesday saw a long wick on top pushed down by bears.

Typically, a kicker pattern like this is the sign of a reversal. If last Friday's low in the $158s is truly the bottom, then bulls need to confirm this by pushing to a new high above the October 20 high of $182.32.  If BABA stock can surmount that prior swing high, then this will confirm that the stock is traversing a new ascending price channel.

BABA daily chart

Premium

You have reached your limit of 3 free articles for this month.

Start your subscription and get access to all our original articles.

Subscribe to PremiumSign In

Author

Clay Webster

Clay Webster

FXStreet

Clay Webster grew up in the US outside Buffalo, New York and Lancaster, Pennsylvania. He began investing after college following the 2008 financial crisis.

More from Clay Webster
Share:

Editor's Picks

EUR/USD pops to yearly highs near 1.1770

EUR/USD rapidly reverses course and hits fresh YTD tops near 1.1780 at the end of the week. The pair’s U-turn comes on the back of the intense sell-off in the Greenback amid the generalised risk-on context.

GBP/USD climbs to four-month tops near 1.3600

GBP/USD is building on its solid weekly advance and is pushing toward the 1.3600 hurdle on Friday, or new four-month peaks. Cable’s strong move higher comes as the Greenback intensifies its decline, while auspicious results on the UK calendar also collaborate with the uptrend.

Gold picks up pace, approaches $5,000

Gold prices keep their uptrend well in place and gear up for an imminent hit to the key $5,000 mark per troy ounce on Friday. The yellow metal’s sharp advance gathers pace amid the increasing weakness in the US Dollar and mixed US Treasury yields across the curve.

Swiss bank UBS Group mulls Bitcoin and Ethereum offering for select private clients

UBS Group AG plans to offer crypto investment services to select private clients. The offering will allow clients of its private bank in Switzerland to buy and sell Bitcoin and Ethereum.

Week ahead – Fed and BoC meet amid geopolitical upheaval and Trump’s Fed pick

Fed to likely go on pause after three straight cuts. BoC is also expected to stand pat. But will Trump steal the limelight by revealing his Fed chair nomination?

Bitcoin slips below $90,000 as Trump's tariffs swing, ETF outflows pressure price

Bitcoin price struggles below $90,000 on Friday, correcting nearly 5% so far this week. Trump’s Davos speech on Wednesday, backing away from imposing further tariffs on the EU, triggered market volatility and risk-on mood.