Investors will get a glimpse at China’s post-COVID recovery when e-commerce giant Alibaba Group (NYSE:BABA) releases its fourth quarter earnings before the bell on Thursday.
Alibaba’s stock has risen close to 20% year to date, compared to a 6% rise in the S&P 500 index, surging from around $91 to as high as $110.
But Alibaba shares have declined by more than 17% since their January 2023 peak of more than US$120.50, and with Nasdaq’s Golden Dragon China index down by more than 10% over the same time, the latest quarterly earnings from Alibaba and fellow Chinese conglomerate Baidu “may not come as a blessing,” according to Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
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“The revenue is seen 6% lower over the year. Even the Singles Day sales may not save the day,” Ozkardeskaya noted.
Wall Street is expecting the Hong Kong-based online retailer to earn $2.37 per share on revenue of $35.73 billion for the three months to end December 2022.
The firm recently announced plans to invest $1 billion over the next three years to strengthen its cloud infrastructure. Alibaba’s management is prioritizing the cloud as a crucial part of its long-term growth and profitability.
Contact Angela at angela@proactiveinvestors.com
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