Analysts from J.P. Morgan and Cantor gave their two cents on two of the most popular stocks, Apple Inc. (NASDAQ:AAPL) and Alibaba Group Holding Ltd (NYSE:BABA) regarding earnings from both. While one believes potential opportunities outweigh reported declines in Apple’s recent earnings, the other predicts a turnaround in overall economic conditions which will have a favorable impact on Alibaba earnings.

Apple Inc.

Analyst Rod Hall of J.P. Morgan weighed in on Apple after the tech giant provided its 10-Q related to its Q2 earnings report. While the analyst notes more than $10 billion in combined off balance sheet debt obligations, he believes the benefits outweigh the costs. He states, “We believe that the growth in additional commitments is related to Apple’s deal with Samsung to produce OLED displays for potential design into the iPhone in 2017.”

Although Apple reported that services ARPU is down, the analyst believes this is nothing new, stating that it started to drop in early 2015. However, he notes a relatively stable gross profit contribution per user and credits an increase in service margins. However, in order for him to get a more accurate picture of Apple’s financials, he believes Apple should change some of the metrics it reports. He explains, “We would like Apple to begin disclosing the number of users that this services revenue is attached to as well as the true Gross Margin on the services associated with the installed base.”

Hall points to a y/y increase in share buybacks reported in the quarter, though the company’s purchase commitments have declined 25% q/q, worse than company guidance. However, the analyst notes that is “due to Apple’s plan to burn inventory in FQ3.” Hall also mentioned that operating margins declined across all of the company’s regions this quarter. He states, “We believe that a combination of weak demand and FX both drove these declines.” The company reiterated its $15.5 billion capex target though Hall notes it only spend $2.8 billion FYTD. He explains, “Given the weak environment, we expect Apple to spend below its target.”

The analyst reiterates an Overweight rating on the company with a $125 price target.

According to TipRanks, out of all the analysts who have rated AAPL in the last 3 months, 89% are bullish while 11% remain on the sidelines. The average 12-month price target for the stock is $129.19, marking a 37% increase from current levels.

Alibaba Group Holding Ltd

Top analyst Yousef Squali of Cantor Fitzgerald provided his expectations for Alibaba’s 4Q:FY16 results, set to release on Thursday. The analyst expects revenues of $3,509 million which represents a 24.8% y/y increase although is slightly lower than consensus estimates of $3,561 million. However, Squali’s EPS estimate of $0.65 is noticeably higher than consensus estimates of $0.55.

The analyst mentions several intra-quarter data points which likely indicate positive earnings results. Squali expects an increase in active users to “drive strong GM growth”, as well increased mobile monetization, which combined should generate 27.5% China Retail revenue growth. Although Squali notes a lukewarm expectation regarding international revenues due to “weakness in the Brazilian and Russian currencies,”  retail sales growth numbers provided by the Chinese government implied “a modestly lower but still impressive growth in consumer spending.” As a result, the analyst notes that “Long-term, BABA remains a key beneficiary of this trend, of the growing Chinese middle class, and rising cross-border trade, in our view.”

Squali states several factors he will be watching for in earnings, mainly related to Chinese consumer trends and competition. The analyst will also be looking for various updates on the company’s recent initiatives. They include its offline to online strategy, its partnership with Suning, financial results from its acquisition of Youku Tudou and AGTech Holdings, and efforts to combat the sale of counterfeit goods.

The analyst reiterates a Buy rating on the stock with a $90 price target.

According to TipRanks, Youssef Squali is ranked #14 out of 3,911 analysts. He has a 63% success rate recommending stocks with an average return of 14.2% per recommendation. All 6 analysts who have rated BABA in the last 3 months, all gave a Buy rating. The average 12-month price target for the stock is $93.50, marking a 23% upside from current levels.Youssef Squali Consensus