TipRanks

About the Author TipRanks

TipRanks is the most comprehensive dataset of analysts, hedge fund managers, financial bloggers, and corporate insiders. We provide answers to the most basic questions: are they reliable and accurate? What is their track record? Are there better opinions out there? And, the most importantly- should I listen to this particular person? TipRanks stops the guessing game and shows you an updated and accurate view so you can make the most educated investment decisions. TipRanks has become the go-to tool for part-time to professional investors and everyone in the financial world.

Alibaba (BABA): A Top-Ranked Growth Stock to Consider


Billionaire Peter Lynch once said, “All you need for a lifetime of successful investing is a few big winners, and the pluses from those will overwhelm the minuses from the stocks that don’t work out.” That’s the key- picking the monster winners and count the returns that follow suit.

We used the TipRanks’ Stock Screener investor tool to pick one of the best market players bursting with growth potential. Here’s how: we filtered by 1) only stocks with a ‘Strong Buy’ best analyst consensus, and 2) stocks showcasing a best analyst price target reflecting strong upside potential. In other words, stocks that analysts say have room to rally over 20% in value.

Chinese e-commerce king Alibaba (NYSE:BABA) is approaching its first fiscal quarter earnings show for 2019 due August 23. Beyond the print, Alibaba is set to heat up rivalry with Tencent-backed Meituan Dianping: this e-commerce player wants to lead China’s lucrative on-demand services market.

How does the BABA team hope to achieve new competitive edge? Reuters is citing sources say Alibaba intends to merge its food delivery units Ele.me and Koubei- and seeks to raise $3 to $5 billion for the combined entity.

Stifel’s Scott Devitt – who ranks #56 out of over 4,800 analysts covered on TipRanks – continues to bat for the bulls on Alibaba. Notably, the analyst upgraded the stock to a Buy back in March 2015- and has been making bullish recommendations on BABA ever since. It’s absolutely paid off- Devitt earns an impressive 34.7% in average profits on his Alibaba ratings. (See Scott Devitt’s other stock recommendations)

Ahead of the print, the analyst reiterates a Buy on BABA with a $256 price target (41% upside potential). Even though Devitt anticipates yuan depreciation to impact Alibaba, he still sees robust return potential ahead.

Regarding total revenue growth, the analyst calls for 69.1% year-over-year to ¥84.9B, noting he expects “marketing, personalization, promotional spending, and the closure of the Ele.me acquisition (late May) to support strong topline momentum.”

Ultimately, “While trade war fears have weighed on investor sentiment, we think concern may be overblown (for now),” contends Devitt.

The ’Strong Buy’ stock has attracted 9 confident Wall Street bulls. How upbeat are analysts in their target expectations? Consider that the 12-month average price target stands tall at $257.89. In other words, analysts are calling for a whopping 41% in upside potential for Alibaba stock. 

 

This article was written by Julie Lamb. The views and opinions expressed herein are the views and opinions of the author and do not reflect those of Smarter Analyst.

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