Alibaba (9988), which has recently weakened with technology stocks, will announce its first quarter results for the 2022 fiscal year after the market closes on Tuesday (3rd). The leading banks expect the group's first quarter revenue to grow by more than 30% year-on-year, but the growth rate will slow down. It is expected that the non-GAAP adjusted net profit will fall back even more than the same period last year.
With the anti-monopoly policy being actively promoted by the central government, the market will focus on Ali’s latest operating guidelines, as well as the management’s launch of globalization and new businesses.
According to Bloomberg’s comprehensive first-quarter financial report forecasts of several major banks, the median income of Ali in the first quarter is expected to be 208.6 billion yuan (RMB, the same below); the non-GAAP adjusted median net profit forecast is 39.46 billion yuan; adjusted The median EBITA is 39.942 billion yuan.
According to Bloomberg's comprehensive forecasts from major brokerage firms, Alibaba's revenue growth in the first quarter of this year is expected to exceed 30%.
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Deutsche Bank: Profits will be masked by investment spending
Among them, Deutsche Bank expects that Alibaba will usher in "A soft quarter ahead." It is expected that the first quarter's profit will be overshadowed by the continued increase in investment spending.
Deutsche Bank estimates that Ali's revenue in the first quarter will increase by 33% year-on-year, but the total is 4% lower than the market average; the quarterly adjusted EBITA is 42 billion yuan, which is higher than the comprehensive expectations of the remaining 13 brokerage firms.
The bank also mentioned that with the successful promotion of the "June 18" festival, it is expected that the core e-commerce business customer management revenue (CMR) will increase by 15% year-on-year.
As for Alibaba Cloud, Deutsche Bank expects Alibaba Cloud's adjusted EBITA to fall by 7.6% quarter-to-quarter.
The bank reiterated its buy rating and lowered its target price from the original 274 yuan to 273 yuan.
Bank of Communications International estimates that Alibaba's strategic development department is expected to lose nearly RMB 70 billion for the year.
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Bank of Communications International: The strategic development department is expected to lose nearly 70 billion for the year
As for the Bank of Communications International, it is expected that Ali’s non-GAAP net profit in the first quarter will fall by 6% year-on-year, while revenue will rise 38% year-on-year to 212.3 billion yuan; adjusted EBITA will fall 6% year-on-year to 42.512 billion yuan.
Bank of Communications also believes that the "June 18" period will help improve user experience. It is expected that e-commerce GMV and customer service revenue will both increase by 17% year-on-year.
Alibaba's 2021 full-year results pointed out that it plans to use all incremental profits and additional capital investment in fiscal year 2022 to support platform merchants and invest in new businesses and key strategic areas.
Bank of Communications International estimates that Alibaba will lose nearly 70 billion yuan in its strategic development department for the whole year, including a loss of 30 billion yuan in community group purchases.
The bank believes that Ali's short-term strategic investment will affect short-term profits, but in the future it will expand the scale of the potentially permeable market.
Credit Suisse: Lowering the profit forecast core e-commerce has long-term value
Credit Suisse issued a report, expecting Ali’s first quarter revenue to record 204 billion yuan, an increase of 33% year-on-year.
With Ali's announcement to increase investment, Credit Suisse expects adjusted EBITA to fall by 11% year-on-year. Among them, investment in new businesses is expected to increase significantly from 4 billion yuan last year to 17 billion yuan.
Credit Suisse decided to lower Alibaba's fiscal year 2022 to fiscal year 2024 earnings per share and lowered its target price to 245 yuan.
However, the bank believes that the current core e-commerce valuation is only 11 times the forecast P/E ratio for the 2021 fiscal year and has long-term investment value. It maintains the "Outperform" rating.
Some analysts predict that Alibaba's investment this year will cover profit growth, and it is expected that a large number of investments will be concentrated in the first half of the year.
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Ali's quarterly performance may disappoint the market, stock prices may be pressured again
In addition, Bloomberg integrated some analysts' comments from major banks.
Among them, Morgan Stanley Gary Yu and other analysts believe that Alibaba's revenue in the first quarter will be lower than market expectations, mainly due to the decline in revenue from its basic customer management and marketing business. It is expected that a large number of investments will be concentrated in the first half of the year.
Analysts such as Daiwa John Choi pointed out that Ali’s revenue growth in the first quarter is expected to be 36%, EBITA is expected to be 37 billion yuan, which is lower than the market consensus, because Ali’s investment in new projects is increasing, including Taobao special edition and community group buying. The investment may drag down the core business of EBITA.
In addition, analysts such as Nomura Jialong Shi wrote in a July 5 report that Alibaba's revenue growth in the first quarter is expected to be 33%, which is lower than market consensus.
Nomura expects that the performance of Alibaba subsidiary Gaoxin will constitute a drag. In addition, the offline supermarket business is sluggish. It is expected that the revenue of Alibaba's new retail business may decline by 13% quarterly.
Alibaba fell 14% in a single month in July, and Bloomberg integrated market participants believe that Alibaba’s quarterly results will disappoint the market or put further pressure on the stock price.
And last week affected by the impact of China's regulatory rectification actions, market participants believe that this round of rectification will make related stocks cheaper.
Alibaba's current 12-month P/E ratio is 18.8 times, which is far lower than the five-year average of 24 times and Amazon (AMZN)'s 44 times.