Alibaba Group Holding Limited gained 4% before the market opens on Thursday after the Chinese e-commerce giant issued their Q2 earnings report, topping analysts’ estimates.
There were several questions raised ahead of the quarter whether the retailer would consistently deliver strong growth numbers amid worries over the slowing Chinese economy.
Meanwhile, the retail giant responded strongly as revenue significantly rallied by 59% in the second quarter, reaching $4.84 billion, exceeding the analysts’ estimate of $4.54 billion.
Second quarter earnings, in exclusion of non-recurring items, has seen a 33% rally on a Year-over-Year (YoY) basis to 74 cents per share, topping the expected 63 cents.
Shares of Alibaba touched an 86.52 buy point on Wednesday, and settled at 87.33 at the close, which rested at a 14-month high.
Further, the Chinese leading online direct sales company JD.com gained earnings beat, which sent its shares rallying, citing its third quarter revenue guidance missed analysts’ forecast. Thus, it was followed by Alibaba’s Q2 financial earnings.
The primary factors that affected the rating had mixed results. The company’s strengths can be seen in its escalating revenue growth, along with largely solid financial position with conceivable debt levels by several measures and an outstanding return on equity.
BABA is in the bullish position with a peak level of 92.78 in late trade on August 11, which had the same level on May 27 last year after the company ranked as the most valuable retail brands worldwide, as shown in the chart below.
Alibaba’s Stocks Higher Before Earnings
During Alibaba’s August Earnings 2015, stock prices traded at 78.09 and consolidates on the next four sessions in an upward trend before the earnings report. On the scheduled date, company shares declined by 6.04 points to at 73.44 at the close in a bullish position.
As speculations arise with Alibaba’s earnings beat report, we expect that this will significantly affect on the company’s shares, along with their sales. We, therefore, conclude that stock prices are highly anticipated to soar before the retail giant issued financial earnings, as investors are closely watching on the report.
Further, share prices of Alibaba continue to surge after the estimates were met.
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