ALIBABA GROUP HOLDING-SP ADR (BABA) Stock Fundamental Analysis
NYSE:BABA - New York Stock Exchange, Inc. - US01609W1027 - ADR
Taking everything into account, BABA scores 5 out of 10 in our fundamental rating. BABA was compared to 32 industry peers in the Broadline Retail industry. BABA has only an average score on both its financial health and profitability. BABA has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year BABA was profitable.
BABA had a positive operating cash flow in the past year.
BABA had positive earnings in each of the past 5 years.
Each year in the past 5 years BABA had a positive operating cash flow.
1.2 Ratios
BABA has a Return On Assets of 4.87%. This is in the better half of the industry: BABA outperforms 61.29% of its industry peers.
The Return On Equity of BABA (9.00%) is comparable to the rest of the industry.
Looking at the Return On Invested Capital, with a value of 7.07%, BABA is in the better half of the industry, outperforming 61.29% of the companies in the same industry.
BABA had an Average Return On Invested Capital over the past 3 years of 6.45%. This is below the industry average of 11.22%.
The 3 year average ROIC (6.45%) for BABA is below the current ROIC(7.07%), indicating increased profibility in the last year.
| 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
Looking at the Profit Margin, with a value of 8.92%, BABA belongs to the top of the industry, outperforming 80.65% of the companies in the same industry.
In the last couple of years the Profit Margin of BABA has declined.
BABA's Operating Margin of 12.07% is amongst the best of the industry. BABA outperforms 87.10% of its industry peers.
In the last couple of years the Operating Margin of BABA has declined.
Looking at the Gross Margin, with a value of 38.20%, BABA is doing worse than 61.29% of the companies in the same industry.
BABA's Gross Margin has declined in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), BABA is destroying value.
BABA has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, BABA has more shares outstanding
The debt/assets ratio for BABA is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.46 indicates that BABA is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of BABA (2.46) is better than 61.29% of its industry peers.
BABA has a debt to FCF ratio of 2.23. This is a good value and a sign of high solvency as BABA would need 2.23 years to pay back of all of its debts.
BABA's Debt to FCF ratio of 2.23 is fine compared to the rest of the industry. BABA outperforms 67.74% of its industry peers.
A Debt/Equity ratio of 0.18 indicates that BABA is not too dependend on debt financing.
With a decent Debt to Equity ratio value of 0.18, BABA is doing good in the industry, outperforming 61.29% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.18 | ||
| Debt/FCF | 2.23 | ||
| Altman-Z | 2.46 |
ROIC/WACC0.95
WACC7.41%
2.3 Liquidity
BABA has a Current Ratio of 1.37. This is a normal value and indicates that BABA is financially healthy and should not expect problems in meeting its short term obligations.
BABA has a Current ratio (1.37) which is comparable to the rest of the industry.
A Quick Ratio of 1.37 indicates that BABA should not have too much problems paying its short term obligations.
The Quick ratio of BABA (1.37) is better than 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 for BABA have decreased by -3.75% in the last year.
BABA shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.09% yearly.
The Revenue has been growing slightly by 5.14% in the past year.
BABA shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 20.09% yearly.
EPS 1Y (TTM)-3.75%
EPS 3Y-1.58%
EPS 5Y10.09%
EPS Q2Q%-3.65%
Revenue 1Y (TTM)5.14%
Revenue growth 3Y9.48%
Revenue growth 5Y20.09%
Sales Q2Q%5.21%
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 6.67% on average over the next years.
EPS Next Y3.25%
EPS Next 2Y7.84%
EPS Next 3Y9.79%
EPS Next 5Y1.2%
Revenue Next Year6.28%
Revenue Next 2Y7.55%
Revenue Next 3Y7.67%
Revenue Next 5Y6.67%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 10.30, the valuation of BABA can be described as very reasonable.
BABA's Price/Earnings ratio is a bit cheaper when compared to the industry. BABA is cheaper than 74.19% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 28.29. BABA is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 8.64, the valuation of BABA can be described as very reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of BABA indicates a rather cheap valuation: BABA is cheaper than 80.65% of the companies listed in the same industry.
BABA's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 24.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.3 | ||
| Fwd PE | 8.64 |
4.2 Price Multiples
BABA's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. BABA is cheaper than 74.19% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of BABA indicates a somewhat cheap valuation: BABA is cheaper than 64.52% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.4 | ||
| EV/EBITDA | 6.78 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
BABA has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.17
PEG (5Y)1.02
EPS Next 2Y7.84%
EPS Next 3Y9.79%
5. Dividend
5.1 Amount
BABA has a Yearly Dividend Yield of 1.19%. Purely for dividend investing, there may be better candidates out there.
BABA's Dividend Yield is a higher than the industry average which is at 5.56.
Compared to an average S&P500 Dividend Yield of 2.28, BABA's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.19% |
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
54.53% of the earnings are spent on dividend by BABA. This is a bit on the high side, but may be sustainable.
DP54.53%
EPS Next 2Y7.84%
EPS Next 3Y9.79%
ALIBABA GROUP HOLDING-SP ADR
NYSE:BABA (1/21/2025, 8:04:00 PM)
After market: 85.8 +0.42 (+0.49%)85.38
+0.26 (+0.31%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustryBroadline Retail
Earnings (Last)
Earnings (Next)
Inst Owners15.24%
Inst Owner Change-1.34%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap203.24B
Analysts82.59
Price Target124.25 (45.53%)
Short Float %1.58%
Short Ratio2.67
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.19% |
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)-0.03%
PT rev (3m)12.9%
EPS NQ rev (1m)0%
EPS NQ rev (3m)1.52%
EPS NY rev (1m)0%
EPS NY rev (3m)0.12%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.4%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)-0.68%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.3 | ||
| Fwd PE | 8.64 | ||
| P/S | 1.54 | ||
| P/FCF | 16.4 | ||
| P/OCF | 9.7 | ||
| P/B | 1.56 | ||
| P/tB | 2.21 | ||
| EV/EBITDA | 6.78 |
EPS(TTM)8.29
EY9.71%
EPS(NY)9.88
Fwd EY11.57%
FCF(TTM)5.21
FCFY6.1%
OCF(TTM)8.8
OCFY10.3%
SpS55.27
BVpS54.81
TBVpS38.57
PEG (NY)3.17
PEG (5Y)1.02
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 | 9.42% |
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-Score5
Asset Turnover0.55
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.18 | ||
| Debt/FCF | 2.23 | ||
| Debt/EBITDA | 1.06 | ||
| Cap/Depr | N/A | ||
| Cap/Sales | N/A | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 95.32% | ||
| Profit Quality | 105.56% | ||
| Current Ratio | 1.37 | ||
| Quick Ratio | 1.37 | ||
| Altman-Z | 2.46 |
F-Score5
WACC7.41%
ROIC/WACC0.95
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)-3.75%
EPS 3Y-1.58%
EPS 5Y10.09%
EPS Q2Q%-3.65%
EPS Next Y3.25%
EPS Next 2Y7.84%
EPS Next 3Y9.79%
EPS Next 5Y1.2%
Revenue 1Y (TTM)5.14%
Revenue growth 3Y9.48%
Revenue growth 5Y20.09%
Sales Q2Q%5.21%
Revenue Next Year6.28%
Revenue Next 2Y7.55%
Revenue Next 3Y7.67%
Revenue Next 5Y6.67%
EBIT growth 1Y-11.4%
EBIT growth 3Y10.68%
EBIT growth 5Y15.63%
EBIT Next Year23.44%
EBIT Next 3Y14%
EBIT Next 5Y12.3%
FCF growth 1Y-29.99%
FCF growth 3Y-7.42%
FCF growth 5Y8.11%
OCF growth 1Y-0.76%
OCF growth 3Y-7.64%
OCF growth 5Y3.88%