What To Expect From Alibaba's Earnings? Here's What Goldman Sachs Is Watching
Portfolio Pulse from Anusuya Lahiri
Goldman Sachs analyst Ronald Keung provides insights on the upcoming earnings for Tencent Holding Ltd (TCEHY) and Alibaba Group Holding Limited (BABA), highlighting expected operating profit growth for Tencent and a decline for Alibaba. The analysis includes expectations for first-quarter revenue growth, second-quarter top-line growth, and updates on shareholder return policies. Keung remains optimistic about both companies, noting potential for valuation improvements and maintaining a Buy rating.
May 13, 2024 | 6:42 pm
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POSITIVE IMPACT
Alibaba is expected to see a -8% group EBITA decline year-on-year, but recent parcel volume growth and a successful eCommerce strategy could lead to a re-acceleration of CMR growth in the second half of 2024. Goldman Sachs maintains a Buy rating.
Despite the expected decline in EBITA, Alibaba's recent parcel volume growth and eCommerce strategy improvements suggest potential for significant recovery and growth, supporting a positive outlook.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100
POSITIVE IMPACT
KraneShares CSI China Internet ETF (KWEB) has seen a +30% increase from late-January lows, reflecting positive momentum in the China internet sector, potentially influenced by the performance of major holdings like Tencent and Alibaba.
KWEB's performance is closely tied to the China internet sector, including companies like Tencent and Alibaba. Positive analyst expectations for these companies could further drive KWEB's growth.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 80
POSITIVE IMPACT
Tencent is expected to see +15% year-on-year operating profit growth, driven by strong games revenue growth re-acceleration and healthy profit growth projections for the first quarter and fiscal 2024. Goldman Sachs maintains a Buy rating.
Tencent's expected operating profit growth and strong games revenue re-acceleration indicate a robust financial performance, justifying Goldman Sachs' positive stance.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100