Alibaba's 12th-Ranked $5.66B Volume Can't Mask 60% Drop From 2020 Highs

On September 2, Alibaba Group (BABA) rose 2.63% with a trading volume of $5.66 billion, ranking 12th in market activity. The stock has traded over 60% below its 2020 pandemic-era highs despite continued revenue growth, with a price-to-earnings ratio of 15.6—half the S&P 500 average. Analysts project a 6% sales increase this year and 8% next year, though net income remains 26% below 2020 levels.

Recent regulatory scrutiny, including a $2.8 billion antitrust fine, and founder Jack Ma’s reduced public presence have weighed on investor sentiment. Earnings estimates for the current quarter show a 27% year-over-year decline, with no revisions to consensus forecasts over the past month. While the company’s revenue growth for the next fiscal year is projected at 7.4%, its Zacks Rank of #5 (Strong Sell) reflects weak near-term performance expectations.

Valuation metrics indicate Alibaba trades at a premium compared to peers, with a Zacks Value Style Score of D. Despite contrarian appeal due to its depressed price, the stock has underperformed broader markets, with a Zacks Internet - Commerce industry gain of 6.9% over the past month outpacing its 14.9% return. The company’s last reported quarter showed a 3.3% revenue increase but a 3.29% earnings miss against estimates.

Historical backtesting indicates $1,000 invested in top Stock Advisor picks since 2004 would have grown to $651,599 (Netflix) or $1,067,639 (Nvidia), compared to the S&P 500’s 185% return. Alibaba was not among the 10 recommended stocks in the latest list, highlighting ongoing skepticism about its near-term outlook despite long-term growth potential.