Retail

Earnings Previews: Alibaba, Kohl's, Macy's

This week’s earnings include a truckload of retailers. Two Dow Jones industrial stocks (Home Depot and Walmart) both beat expectations Tuesday morning. More retailer reports are due later this week.

After markets closed Monday, Bitfarms, IonQ and Lucid reported quarterly results. IonQ and Lucid saw bump in their share prices while Bitfarms was trading down. After markets close Tuesday and before they open on Wednesday, reports are coming from Lowe’s, Target, TJX and StoneCo.

We already have posted our preview of two tech biggies (Cisco and Nvidia) scheduled to report results after markets close Wednesday.

Here’s a look at three retailers set to report results before markets open on Thursday.

Alibaba

Over the past 12 months, shares of Alibaba Group Holding Ltd. (NYSE: BABA) have lost about 35% of their value. That may be hard to believe for a company that pumped out $84.5 billion in sales in the first 11 days of November, the company’s annual Singles Day promotion. The moral may be that it’s bad for a company’s financial health to get crossways with Xi Jinping.

Singapore’s state-owned investment firm Temasek cut its stake in Alibaba by 16% in the third quarter and made other sales and adjustments following the central government’s rules changes for China-based companies.

Of the 44 analysts covering the company, 41 have ratings of Buy or Strong Buy on the stock. The other three rate the stock at Hold. At a recent price of around $167.10, the upside potential based on a median price target of $242.59 is about 45%. At the high price target of $339.90, the upside potential is 103%.

For Alibaba’s second quarter of fiscal 2022, analysts are expecting revenue of $32.11 billion, which would be up about 0.8% sequentially and nearly 41% higher year over year. Adjusted earnings per share (EPS) are expected to come in at $1.95, down 24% sequentially and 26% lower year over year. For the full fiscal year ending in March 2022, Alibaba is expected to report EPS of $9.26, up almost 650%, on sales of $142.87 billion, up 30.5%.

Alibaba’s share price to earnings multiple for the 2022 fiscal year is 18.0. For the 2023 fiscal year, the multiple to estimated EPS of $10.78 is 15.5, and for 2024, it is 12.8 times estimated EPS of $13.07. The stock’s 52-week range is $138.43 to $280.61. Alibaba does not pay a dividend. Total shareholder return for the past year is negative 35.4%.