New Buy Rating for Alibaba (BABA), the Technology Giant

In a report released yesterday, Youssef Squali from SunTrust Robinson maintained a Buy rating on Alibaba (BABAResearch Report), with a price target of $205. The company’s shares closed last Monday at $164.03.

Squali commented:

“We expect net revenue of 112.0B RMB (+36.1% Y/Y excl. Ele.me) vs. consensus of 111.8B RMB. We also expect EBITA of 24.5 RMB vs. consensus of 29.4B RMB. We note that the company’s results relative to expectations have been somewhat inconsistent over the last several quarters, at times beating (like in F4Q19) but at times missing on the top and/or bottom lines (as in F2Q19 and F3Q19). While Core Commerce margins have remained strong over the last several quarters, pointing to healthy underlying fundamentals. we note that investments is Initiatives have at times weighted down overall margins.”

According to TipRanks.com, Squali is a top 100 analyst with an average return of 25.6% and a 70.9% success rate. Squali covers the Technology sector, focusing on stocks such as ANGI Homeservices Inc, Uber Technologies Inc, and IAC/InterActiveCorp.

Alibaba has an analyst consensus of Strong Buy, with a price target consensus of $218.94, a 36.3% upside from current levels. In a report issued on August 5, Jefferies also initiated coverage with a Buy rating on the stock with a $216 price target.

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Based on Alibaba’s latest earnings release for the quarter ending March 31, the company reported a quarterly net profit of $3.83 billion. In comparison, last year the company had a net profit of $1.36 billion.

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