Alibaba (BABA) is scheduled to report results of its second fiscal quarter of FY18 before the market open on Thursday, November 2, with a conference call scheduled for 7:30 am ET. What to watch for: 1. REVENUE GROWTH ABOVE 50%?: Along with its last report, Alibaba reiterated its FY18 revenue growth guidance of 45%-49%. However, revenue consensus currently stands at $7.85B for this quarter, which represents a year-over-year growth rate of about 52%. Stifel analyst Scott Devitt forecasts an even higher Q2 revenue growth rate of 54.5%, as he expects the company’s top-line to continue to benefit from core commerce personalization updates and heavier promotional activity. Barclays analyst Gregory Zhao raised his price target for Alibaba to $220 from $200 earlier this week and reiterated an Overweight rating on the name, noting he expects the company to report “solid” Q3 results with sales growth of 54%. 2. SINGLES DAY UPCOMING: The biggest day of Alibaba’s year, “Single’s Day,” is coming up later this month. Last year, Alibaba announced that $17.8B of gross merchandise volume, or GMV, was settled through Alipay on Alibaba’s China and international retail marketplaces on the 11.11 shopping holiday. On October 17 the Nikkei Asian Review reported that JD.com (JD), in a bid to better compete with Alibaba ahead of Single’s Day, announced plans to share customer data with Tencent (TCEHY) and team with Wal-Mart (WMT) on member benefits and sales fulfillment. 3. CLOUD: With its last report, Alibaba reported that the number of paying customers of its cloud computing business grew to over 1M from 874,000 in the previous quarter. While Microsoft (MSFT) and Amazon (AMZN) duke it out to be the number one U.S. cloud company, with Google (GOOG) often mentioned as the third leading domestic competitor, DigiTimes reported on October 17 that Alibaba president Simon Hu said Alibaba Cloud plans to become one of the top two public cloud computing service providers in the world within two to three years. The service, which currently is the third largest provider in the space, aims to pass Microsoft’s Azure to compete for the top spot with AWS, according to the report. On October 16, Macquarie analyst Wendy Huang raised her price target for Alibaba shares to $245 after attending the company’s cloud conference. The analyst is giving Alibaba a higher valuation for its cloud initiatives and reiterates an Outperform rating on the shares. Her $245 price target is currently the high on the Street, according to Bloomberg data.
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