ALIBABA GROUP HOLDING-SP ADR (BABA) Stock Fundamental Analysis
NYSE:BABA - New York Stock Exchange, Inc. - US01609W1027 - ADR - Currency: USD
Overall BABA gets a fundamental rating of 5 out of 10. We evaluated BABA against 32 industry peers in the Broadline Retail industry. BABA has an average financial health and profitability rating. BABA has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year BABA was profitable.
In the past year BABA had a positive cash flow from operations.
Each year in the past 5 years BABA has been profitable.
In the past 5 years BABA always reported a positive cash flow from operatings.
1.2 Ratios
BABA has a better Return On Assets (4.87%) than 61.29% of its industry peers.
Looking at the Return On Equity, with a value of 9.00%, BABA is in line with its industry, outperforming 54.84% of the companies in the same industry.
The Return On Invested Capital of BABA (7.07%) is better than 61.29% of its industry peers.
The Average Return On Invested Capital over the past 3 years for BABA is below the industry average of 11.29%.
The last Return On Invested Capital (7.07%) for BABA is above the 3 year average (6.45%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.87% | ||
| ROE | 9% | ||
| ROIC | 7.07% |
ROA(3y)4.1%
ROA(5y)6.51%
ROE(3y)7.31%
ROE(5y)11.55%
ROIC(3y)6.45%
ROIC(5y)6.42%
1.3 Margins
With a decent Profit Margin value of 8.92%, BABA is doing good in the industry, outperforming 77.42% of the companies in the same industry.
BABA's Profit Margin has declined in the last couple of years.
The Operating Margin of BABA (12.07%) is better than 87.10% of its industry peers.
BABA's Operating Margin has declined in the last couple of years.
BABA has a Gross Margin of 38.20%. This is in the lower half of the industry: BABA underperforms 61.29% of its industry peers.
In the last couple of years the Gross Margin of BABA has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.07% | ||
| PM (TTM) | 8.92% | ||
| GM | 38.2% |
OM growth 3Y1.1%
OM growth 5Y-3.71%
PM growth 3Y-26.05%
PM growth 5Y-18.28%
GM growth 3Y-3.16%
GM growth 5Y-3.83%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so BABA is destroying value.
BABA has less shares outstanding than it did 1 year ago.
BABA has more shares outstanding than it did 5 years ago.
BABA has a worse debt/assets ratio than last year.
2.2 Solvency
BABA has an Altman-Z score of 3.10. This indicates that BABA is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.10, BABA is in the better half of the industry, outperforming 64.52% of the companies in the same industry.
The Debt to FCF ratio of BABA is 1.97, which is an excellent value as it means it would take BABA, only 1.97 years of fcf income to pay off all of its debts.
BABA's Debt to FCF ratio of 1.97 is fine compared to the rest of the industry. BABA outperforms 70.97% of its industry peers.
A Debt/Equity ratio of 0.18 indicates that BABA is not too dependend on debt financing.
The Debt to Equity ratio of BABA (0.18) is better than 61.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.18 | ||
| Debt/FCF | 1.97 | ||
| Altman-Z | 3.1 |
ROIC/WACC0.78
WACC9.1%
2.3 Liquidity
A Current Ratio of 1.37 indicates that BABA should not have too much problems paying its short term obligations.
BABA's Current ratio of 1.37 is in line compared to the rest of the industry. BABA outperforms 54.84% of its industry peers.
A Quick Ratio of 1.37 indicates that BABA should not have too much problems paying its short term obligations.
BABA has a Quick ratio of 1.37. This is in the better half of the industry: BABA outperforms 64.52% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.37 | ||
| Quick Ratio | 1.37 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 0.36% over the past year.
The Earnings Per Share has been growing by 10.09% on average over the past years. This is quite good.
BABA shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.34%.
The Revenue has been growing by 20.09% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)0.36%
EPS 3Y-1.58%
EPS 5Y10.09%
EPS Q2Q%12.11%
Revenue 1Y (TTM)8.34%
Revenue growth 3Y9.48%
Revenue growth 5Y20.09%
Sales Q2Q%7.01%
3.2 Future
Based on estimates for the next years, BABA will show a small growth in Earnings Per Share. The EPS will grow by 1.20% on average per year.
The Revenue is expected to grow by 6.59% on average over the next years.
EPS Next Y3.14%
EPS Next 2Y7.72%
EPS Next 3Y9.17%
EPS Next 5Y1.2%
Revenue Next Year6.18%
Revenue Next 2Y7.28%
Revenue Next 3Y7.53%
Revenue Next 5Y6.59%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 16.58, which indicates a correct valuation of BABA.
64.52% of the companies in the same industry are more expensive than BABA, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 29.63. BABA is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 14.48, which indicates a correct valuation of BABA.
Compared to the rest of the industry, the Price/Forward Earnings ratio of BABA indicates a somewhat cheap valuation: BABA is cheaper than 67.74% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.68. BABA is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.58 | ||
| Fwd PE | 14.48 |
4.2 Price Multiples
61.29% of the companies in the same industry are more expensive than BABA, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, BABA is valued a bit cheaper than 61.29% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.14 | ||
| EV/EBITDA | 12.16 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates BABA does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)5.29
PEG (5Y)1.64
EPS Next 2Y7.72%
EPS Next 3Y9.17%
5. Dividend
5.1 Amount
BABA has a yearly dividend return of 0.78%, which is pretty low.
Compared to an average industry Dividend Yield of 5.54, BABA pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.78, BABA pays less dividend than the S&P500 average, which is at 2.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.78% |
5.2 History
BABA does not have a reliable dividend history as it only pays dividend since a couple or years.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
BABA pays out 54.53% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP54.53%
EPS Next 2Y7.72%
EPS Next 3Y9.17%
143.75
+7.78 (+5.72%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustryBroadline Retail
Earnings (Last)
Earnings (Next)
Inst Owners15.24%
Inst Owner Change-7.77%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap341.54B
Analysts82.4
Price Target123.67 (-13.97%)
Short Float %2.08%
Short Ratio2.4
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.78% |
Yearly Dividend0.9
Dividend Growth(5Y)N/A
DP54.53%
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)2.51%
Min EPS beat(2)-0.76%
Max EPS beat(2)5.79%
EPS beat(4)1
Avg EPS beat(4)-0.17%
Min EPS beat(4)-3.01%
Max EPS beat(4)5.79%
EPS beat(8)4
Avg EPS beat(8)5.5%
EPS beat(12)8
Avg EPS beat(12)6.01%
EPS beat(16)10
Avg EPS beat(16)4.26%
Revenue beat(2)0
Avg Revenue beat(2)-3.6%
Min Revenue beat(2)-4.25%
Max Revenue beat(2)-2.95%
Revenue beat(4)0
Avg Revenue beat(4)-2.69%
Min Revenue beat(4)-4.25%
Max Revenue beat(4)-0.97%
Revenue beat(8)1
Avg Revenue beat(8)-1.79%
Revenue beat(12)2
Avg Revenue beat(12)-1.74%
Revenue beat(16)4
Avg Revenue beat(16)-1.6%
PT rev (1m)-2.53%
PT rev (3m)0.58%
EPS NQ rev (1m)-1.6%
EPS NQ rev (3m)-0.11%
EPS NY rev (1m)-0.11%
EPS NY rev (3m)0.82%
Revenue NQ rev (1m)0.18%
Revenue NQ rev (3m)-0.22%
Revenue NY rev (1m)-0.09%
Revenue NY rev (3m)-0.66%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.58 | ||
| Fwd PE | 14.48 | ||
| P/S | 2.58 | ||
| P/FCF | 24.14 | ||
| P/OCF | 16.19 | ||
| P/B | 2.6 | ||
| P/tB | 3.69 | ||
| EV/EBITDA | 12.16 |
EPS(TTM)8.67
EY6.03%
EPS(NY)9.93
Fwd EY6.91%
FCF(TTM)5.95
FCFY4.14%
OCF(TTM)8.88
OCFY6.18%
SpS55.77
BVpS55.31
TBVpS38.93
PEG (NY)5.29
PEG (5Y)1.64
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.87% | ||
| ROE | 9% | ||
| ROCE | 8.81% | ||
| ROIC | 7.07% | ||
| ROICexc | 10.03% | ||
| ROICexgc | 14.41% | ||
| OM | 12.07% | ||
| PM (TTM) | 8.92% | ||
| GM | 38.2% | ||
| FCFM | 10.68% |
ROA(3y)4.1%
ROA(5y)6.51%
ROE(3y)7.31%
ROE(5y)11.55%
ROIC(3y)6.45%
ROIC(5y)6.42%
ROICexc(3y)10.57%
ROICexc(5y)10.27%
ROICexgc(3y)16.93%
ROICexgc(5y)17.44%
ROCE(3y)8.04%
ROCE(5y)8%
ROICexcg growth 3Y9.15%
ROICexcg growth 5Y-1.21%
ROICexc growth 3Y13.34%
ROICexc growth 5Y8.21%
OM growth 3Y1.1%
OM growth 5Y-3.71%
PM growth 3Y-26.05%
PM growth 5Y-18.28%
GM growth 3Y-3.16%
GM growth 5Y-3.83%
F-Score6
Asset Turnover0.55
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.18 | ||
| Debt/FCF | 1.97 | ||
| Debt/EBITDA | 1.06 | ||
| Cap/Depr | 113.33% | ||
| Cap/Sales | 5.24% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 95.32% | ||
| Profit Quality | 119.63% | ||
| Current Ratio | 1.37 | ||
| Quick Ratio | 1.37 | ||
| Altman-Z | 3.1 |
F-Score6
WACC9.1%
ROIC/WACC0.78
Cap/Depr(3y)86.04%
Cap/Depr(5y)91.05%
Cap/Sales(3y)4.57%
Cap/Sales(5y)5.73%
Profit Quality(3y)186.71%
Profit Quality(5y)155.24%
High Growth Momentum
Growth
EPS 1Y (TTM)0.36%
EPS 3Y-1.58%
EPS 5Y10.09%
EPS Q2Q%12.11%
EPS Next Y3.14%
EPS Next 2Y7.72%
EPS Next 3Y9.17%
EPS Next 5Y1.2%
Revenue 1Y (TTM)8.34%
Revenue growth 3Y9.48%
Revenue growth 5Y20.09%
Sales Q2Q%7.01%
Revenue Next Year6.18%
Revenue Next 2Y7.28%
Revenue Next 3Y7.53%
Revenue Next 5Y6.59%
EBIT growth 1Y-11.4%
EBIT growth 3Y10.68%
EBIT growth 5Y15.63%
EBIT Next Year23.89%
EBIT Next 3Y14.06%
EBIT Next 5Y12.3%
FCF growth 1Y-2.65%
FCF growth 3Y-7.42%
FCF growth 5Y8.11%
OCF growth 1Y-0.76%
OCF growth 3Y-7.64%
OCF growth 5Y3.88%