Alibaba's $0.96B Volume Slump Ranks 80th as Stock Underperforms Sector Pre-Earnings

Alibaba Group Holding Limited (BABA) fell 1.16% to $119.99 on August 19, 2025, with a trading volume of $0.96 billion, ranking 80th in market activity. The decline outpaced the S&P 500’s 0.59% loss and the Nasdaq’s 1.46% drop. The stock is set to report Q2 earnings on August 29, with analysts forecasting an EPS of $2.13, a 5.75% decline year-over-year, and revenue of $34.26 billion, up 2.37% from the prior year. The Zacks Consensus Estimates project full-year earnings of $8.58 per share and revenue of $141.93 billion, reflecting a -4.77% and +2.75% change, respectively, compared to 2024. Analysts are closely monitoring estimate revisions, which historically correlate with near-term stock performance.

Alibaba’s valuation metrics suggest a discount relative to its industry peers. The stock trades at a Forward P/E of 14.16, below the Retail-Wholesale sector’s 19.74 average. However, its PEG ratio of 1.63 exceeds the Internet-Commerce industry’s 1.54, indicating lower growth expectations. The company holds a Zacks Rank of #5 (Strong Sell), reflecting persistent downward revisions to earnings forecasts. Despite a 0.94% monthly gain, Alibaba underperformed the sector’s 3.3% rise, signaling ongoing investor caution ahead of its earnings release.

The backtest of a strategy buying the top 500 stocks by daily trading volume and holding for one day from 2022 to 2025 yielded a 1.98% average 1-day return and a total annual return of 7.61%. While the approach demonstrated stability, its Sharpe ratio of 0.71 highlights modest risk-adjusted returns, underscoring the limited effectiveness of volume-based strategies in volatile markets.