ALIBABA GROUP HOLDING-SP ADR (BABA) Stock Fundamental Analysis
NYSE:BABA - New York Stock Exchange, Inc. - US01609W1027 - ADR - Currency: USD
We assign a fundamental rating of 4 out of 10 to BABA. BABA was compared to 30 industry peers in the Broadline Retail industry. BABA has only an average score on both its financial health and profitability. BABA has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year BABA was profitable.
BABA had positive earnings in each of the past 5 years.
Of the past 5 years BABA 4 years had a positive operating cash flow.
1.2 Ratios
BABA has a better Return On Assets (7.18%) than 70.00% of its industry peers.
BABA has a Return On Equity of 12.82%. This is in the better half of the industry: BABA outperforms 73.33% of its industry peers.
BABA has a Return On Invested Capital of 8.29%. This is in the better half of the industry: BABA outperforms 70.00% of its industry peers.
BABA had an Average Return On Invested Capital over the past 3 years of 7.11%. This is below the industry average of 11.34%.
The 3 year average ROIC (7.11%) for BABA is below the current ROIC(8.29%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.18% | ||
| ROE | 12.82% | ||
| ROIC | 8.29% |
ROA(3y)5.28%
ROA(5y)5.68%
ROE(3y)9.41%
ROE(5y)10.16%
ROIC(3y)7.11%
ROIC(5y)6.48%
1.3 Margins
BABA's Profit Margin of 12.99% is amongst the best of the industry. BABA outperforms 90.00% of its industry peers.
BABA's Profit Margin has declined in the last couple of years.
BABA's Operating Margin of 14.69% is amongst the best of the industry. BABA outperforms 90.00% of its industry peers.
BABA's Operating Margin has declined in the last couple of years.
With a Gross Margin value of 39.95%, BABA is not doing good in the industry: 63.33% of the companies in the same industry are doing better.
BABA's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.69% | ||
| PM (TTM) | 12.99% | ||
| GM | 39.95% |
OM growth 3Y9.46%
OM growth 5Y-4.76%
PM growth 3Y21.4%
PM growth 5Y-15%
GM growth 3Y2.73%
GM growth 5Y-2.4%
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 less shares outstanding
Compared to 1 year ago, BABA has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 3.05 indicates that BABA is not in any danger for bankruptcy at the moment.
BABA has a better Altman-Z score (3.05) than 66.67% of its industry peers.
BABA has a Debt/Equity ratio of 0.21. This is a healthy value indicating a solid balance between debt and equity.
BABA's Debt to Equity ratio of 0.21 is in line compared to the rest of the industry. BABA outperforms 56.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 3.05 |
ROIC/WACC0.91
WACC9.09%
2.3 Liquidity
A Current Ratio of 1.55 indicates that BABA should not have too much problems paying its short term obligations.
With a Current ratio value of 1.55, BABA perfoms like the industry average, outperforming 46.67% of the companies in the same industry.
BABA has a Quick Ratio of 1.55. This is a normal value and indicates that BABA is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.55, BABA is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.55 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 5.31% over the past year.
BABA shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 4.28% yearly.
BABA shows a small growth in Revenue. In the last year, the Revenue has grown by 5.86%.
Measured over the past years, BABA shows a quite strong growth in Revenue. The Revenue has been growing by 14.35% on average per year.
EPS 1Y (TTM)5.31%
EPS 3Y7.52%
EPS 5Y4.28%
EPS Q2Q%23.47%
Revenue 1Y (TTM)5.86%
Revenue growth 3Y5.31%
Revenue growth 5Y14.35%
Sales Q2Q%6.57%
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 1.11% on average per year.
The Revenue is expected to grow by 5.46% on average over the next years.
EPS Next Y15.85%
EPS Next 2Y14.75%
EPS Next 3Y11.94%
EPS Next 5Y1.11%
Revenue Next Year6.22%
Revenue Next 2Y7.16%
Revenue Next 3Y7.4%
Revenue Next 5Y5.46%
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
Based on the Price/Earnings ratio of 12.82, the valuation of BABA can be described as correct.
Based on the Price/Earnings ratio, BABA is valued a bit cheaper than 76.67% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.60, BABA is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 11.06, the valuation of BABA can be described as reasonable.
Based on the Price/Forward Earnings ratio, BABA is valued a bit cheaper than the industry average as 80.00% of the companies are valued more expensively.
BABA's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.82 | ||
| Fwd PE | 11.06 |
4.2 Price Multiples
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
BABA's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
PEG (NY)0.81
PEG (5Y)2.99
EPS Next 2Y14.75%
EPS Next 3Y11.94%
5. Dividend
5.1 Amount
BABA has a yearly dividend return of 0.86%, which is pretty low.
Compared to an average industry Dividend Yield of 9.86, BABA pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.39, BABA's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.86% |
5.2 History
BABA has been paying a dividend for less than 5 years, so it still needs to build a track record.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
DP0%
EPS Next 2Y14.75%
EPS Next 3Y11.94%
116.62
-3.71 (-3.08%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustryBroadline Retail
Earnings (Last)
Earnings (Next)
Inst Owners14.49%
Inst Owner Change12.77%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap278.15B
Analysts86.12
Price Target163.65 (40.33%)
Short Float %1.69%
Short Ratio1.97
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.86% |
Yearly Dividend1
Dividend Growth(5Y)N/A
DP0%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.92%
Min EPS beat(2)-5.13%
Max EPS beat(2)6.96%
EPS beat(4)2
Avg EPS beat(4)1.71%
Min EPS beat(4)-5.13%
Max EPS beat(4)6.96%
EPS beat(8)3
Avg EPS beat(8)2.27%
EPS beat(12)7
Avg EPS beat(12)5.43%
EPS beat(16)10
Avg EPS beat(16)4.72%
Revenue beat(2)0
Avg Revenue beat(2)-2.03%
Min Revenue beat(2)-2.29%
Max Revenue beat(2)-1.77%
Revenue beat(4)0
Avg Revenue beat(4)-2.82%
Min Revenue beat(4)-4.25%
Max Revenue beat(4)-1.77%
Revenue beat(8)1
Avg Revenue beat(8)-1.82%
Revenue beat(12)1
Avg Revenue beat(12)-1.82%
Revenue beat(16)2
Avg Revenue beat(16)-2.03%
PT rev (1m)0.69%
PT rev (3m)4.08%
EPS NQ rev (1m)-8.8%
EPS NQ rev (3m)-8.11%
EPS NY rev (1m)-1.6%
EPS NY rev (3m)5.14%
Revenue NQ rev (1m)-2.03%
Revenue NQ rev (3m)-2.3%
Revenue NY rev (1m)-0.71%
Revenue NY rev (3m)-0.99%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.82 | ||
| Fwd PE | 11.06 | ||
| P/S | 2.01 | ||
| P/FCF | N/A | ||
| P/OCF | N/A | ||
| P/B | 1.98 | ||
| P/tB | 2.73 | ||
| EV/EBITDA | N/A |
EPS(TTM)9.1
EY7.8%
EPS(NY)10.54
Fwd EY9.04%
FCF(TTM)N/A
FCFYN/A
OCF(TTM)N/A
OCFYN/A
SpS58.12
BVpS58.91
TBVpS42.79
PEG (NY)0.81
PEG (5Y)2.99
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.18% | ||
| ROE | 12.82% | ||
| ROCE | 10.69% | ||
| ROIC | 8.29% | ||
| ROICexc | 12.06% | ||
| ROICexgc | 17.07% | ||
| OM | 14.69% | ||
| PM (TTM) | 12.99% | ||
| GM | 39.95% | ||
| FCFM | N/A |
ROA(3y)5.28%
ROA(5y)5.68%
ROE(3y)9.41%
ROE(5y)10.16%
ROIC(3y)7.11%
ROIC(5y)6.48%
ROICexc(3y)11.36%
ROICexc(5y)10.25%
ROICexgc(3y)17.38%
ROICexgc(5y)16.27%
ROCE(3y)9.18%
ROCE(5y)8.35%
ROICexcg growth 3Y6.77%
ROICexcg growth 5Y-3.12%
ROICexc growth 3Y11.73%
ROICexc growth 5Y2.88%
OM growth 3Y9.46%
OM growth 5Y-4.76%
PM growth 3Y21.4%
PM growth 5Y-15%
GM growth 3Y2.73%
GM growth 5Y-2.4%
F-ScoreN/A
Asset Turnover0.55
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | N/A | ||
| Cap/Sales | N/A | ||
| Interest Coverage | N/A | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.55 | ||
| Altman-Z | 3.05 |
F-ScoreN/A
WACC9.09%
ROIC/WACC0.91
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)5.31%
EPS 3Y7.52%
EPS 5Y4.28%
EPS Q2Q%23.47%
EPS Next Y15.85%
EPS Next 2Y14.75%
EPS Next 3Y11.94%
EPS Next 5Y1.11%
Revenue 1Y (TTM)5.86%
Revenue growth 3Y5.31%
Revenue growth 5Y14.35%
Sales Q2Q%6.57%
Revenue Next Year6.22%
Revenue Next 2Y7.16%
Revenue Next 3Y7.4%
Revenue Next 5Y5.46%
EBIT growth 1Y18.12%
EBIT growth 3Y15.27%
EBIT growth 5Y8.9%
EBIT Next Year37.87%
EBIT Next 3Y21.96%
EBIT Next 5Y12.57%
FCF growth 1YN/A
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1YN/A
OCF growth 3YN/A
OCF growth 5YN/A