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Earnings Previews: Alibaba, Discovery, Newmont, Nikola, Norwegian Cruise Lines

Markets were closed Monday in observance of Presidents Day. Even so, a couple of intrepid energy companies chose to report results when no one was around to hear them.

Oil and gas producer APA (formerly Apache) reported adjusted earnings that missed expectations by 11.6% and revenue estimates by nearly 35%. The company also doubled its dividend to $0.125 per quarter and committed to a 60% capital return plan for investors. APA’s stock traded up 4.4% in Tuesday’s premarket. Pipeline operator Williams reported beats on both the top and bottom lines and guided 2022 dividends to $1.70 annually, up from $1.64 in 2021. Shares traded up by about 2% in the premarket session Tuesday.

Before markets opened Tuesday, these three companies also reported quarterly results: Home Depot, Macy’s and Medtronic reported results. After markets close Tuesday, Palo Alto Networks, Range Resources, Teladoc and Virgin Galactic will share their results. We also have previewed four companies that report quarterly results on Wednesday: Clover Health, eBay, Skillz and TJX.

Before markets open Thursday, we shall hear from these five companies, along with a host of others.

Alibaba

Over the past 12 months, shares of Alibaba Group Holding Ltd. (NYSE: BABA) have lost about 57% of their value. Every Chinese tech stock has been hammered by tighter government regulation, and Alibaba’s financial division has been hit especially hard. The government reportedly has begun taking yet another look at Alibaba’s financial dealings with Ant Group, a firm controlled by Alibaba founder Jack Ma. Whether the probes will continue (and for how much longer) is anyone’s guess.

There are 46 analysts covering the company, and 40 have ratings of Buy or Strong Buy on the stock. The other six rate the stock at Hold. At a recent price of around $113.40 a share, the upside potential based on a median price target of $181.34 is about 60%. At the high price target of $305.36, the upside potential is 169%.

For Alibaba’s third quarter of fiscal 2022, analysts are expecting revenue of $38.88 billion, up about nearly 25% sequentially and nearly 14.8% higher year over year. Adjusted earnings per share (EPS) are expected to come in at $2.56, up 146% sequentially but down 24% year over year. For the full fiscal year ending in March, Alibaba is expected to report EPS of $8.34, up 571%, on sales of $136.83 billion, up 25%.

Shares trade at 13.6 times expected 2022 EPS, 12.2 times estimated 2023 earnings of $9.30 and 10.7 times estimated 2024 earnings of $10.57 per share. The stock’s 52-week range is $108.70 to $259.46. Alibaba does not pay a dividend. Total shareholder return for the past 12 months is negative 55.5%.

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