Alibaba stock has been quietly inching closer and closer to its all-time high. This has many people wondering if its upcoming earnings announcement will be the exact catalyst it needs to break out to new levels. What's going on moon gang, i hope you're having a great day. My name is matt and in this video i will be discussing alibaba's fundamentals and most recent earnings report.

So we have a better idea of what might happen after their upcoming one on thursday august 20th. Make sure you stick around until the end, because i will also be doing a technical breakdown of the chart if you're interested in this type of stock market related content join the moon game by hitting the subscribe button. Don't forget to turn on your notifications, so you don't miss any of the new videos alrighty. Then, let's get started for those of you who don't know.

Alibaba is an enormous chinese-based ecommerce company, but to be fair, they also do many other things which i will touch on later in this video here is a look at alibaba's income statement from 2016. Until now, their total revenues have grown from 15.5 billion. All the way to 72 billion and their gross profits have been scaled from 10 billion, all the way to 32 billion. Let's take a quick peek at their net income.

In that same time period, their net income has practically doubled from 11 billion to 21 billion. This type of growth in their revenues, profit and net income, is exactly what you want to see as an investor, but the story doesn't end there, though. Let's check out their balance sheet. Alibaba has grown their total cash from 18 billion to an impressive 51 billion.

Their total current assets sits at 65 billion, while their total current liabilities is 34 billion. This ratio of roughly 2 to 1 is pretty solid, their total assets is 185 billion and their total liabilities is 62 billion. This is another solid ratio of roughly three to one. When you consider alibaba's assets and liabilities, it's pretty obvious that they won't be running out of money anytime soon and on top of that they have a cash stockpile to continue to grow their business operations.

From a fundamental perspective, this type of positioning and trending growth is exactly what you want to see as an investor wall. Street analysts also happen to agree with this statement, with one being very bearish and five being very bullish. The average analyst rating is 4.76, which makes them very bullish out of 50 analyst. Ratings 49 are either very bullish or bullish.

At the time i'm making this alibaba is trading just above 260 dollars. The average price target is 290, which means that analysts think there's a decent upside potential of thirty dollars. I don't find this bullish sentiment to be surprising or unwarranted, because lately alibaba has been doing notably well in terms of the most recent earnings report. Alibaba kicked ass.

They reported a 9.20 earnings per share which destroyed the comically low estimate of 59 cents. The company had a revenue of 114 billion dollars for the quarter compared to the estimate of 108 billion. Its revenue was up 22.3 compared to the same quarter. Last year, alibaba has generated six dollars and three cents earnings per share over the last year and currently has a price to earnings ratio of 32.6.

To give you a little perspective on if this is expensive or not it's roughly in line with microsoft, but it's much much cheaper than amazon and, as i said before, alibaba's next earnings report will be published on thursday august 20th. They either will or won't beat estimates, but, as things currently stand, i'm siding with the bulls, most people, think of alibaba as an e-commerce business but in reality, they're involved in many other things, including streaming movie production and even food delivery to name a few. But with all that being said, i'm most excited about alibaba's development and operations in cloud computing. The cloud business sector hasn't been profitable yet, but it is trending in the right direction and if amazon's, aws and microsoft's azure are any indication, alibaba's cloud operations will be a huge revenue generator.

They are extremely well positioned to take full advantage of the massive market. That is china and, as a quick side note in the upcoming quarter, revenues from the cloud segment are expected to have increased from a year ago, backed by the growth in the numbers of paying customers and higher than usual spending in general. I personally believe that cloud computing will do nothing but become more important in the future, so i'm naturally a fan of any company. That's well positioned within this sector.

My bullish statements on alibaba do come with two important caveats. First, they are seeing an increased amount of competition from companies like amazon, jd, microsoft tencent. The list goes on but more importantly, there are political concerns. Now i'm not a political commentary channel.

So i don't want to get too deep into this, but an increase in international tensions could have an adverse effect on the company. I just thought this is something you should be aware of now that we've covered alibaba's fundamentals and most recent earnings report. Let's do a quick technical breakdown of its stock, the ticker symbol is baba and, as of the most recent close, the stock is currently up 22 on the year at one point in march, it was down 19, but since that low the stock has managed to rally An impressive 52 percent in terms of structure, there are two primary wedge formations and the second one was created after this crazy breakout at the start of july. Let's zoom in a little bit to get a better idea of the upcoming support and resistance, whether you're, bullish or bearish.

You should always be placing your trades at these levels, so you can optimize your risk to reward. If you're in the bowl camp, you should be buying at support and selling at resistance, and if you're in the bear camp, you should be doing the exact opposite. If the upcoming earnings report is well received and the stock gets above this top trend line, i would expect there to be resistance at the all-time high at 268 dollars. If the bears can't hold this line, i would expect the bullish momentum to rapidly increase, which would cause the stock to run, but on the flip side, if the stock is rejected at this resistance or the high from august, or even this top trend line, there could Be a reversion back to this bottom trend line.

If not enough demand is found in this zone and the stock falls through. You could then look for a bounce off the start of this wedge at 240. If the bears pushed the market through this area, you could then look for a bounce off of the gap fill at 225. To be fully honest, though, unless something major happens, i don't think alibaba will be trading in this area anytime soon.

Overall, i am bullish on alibaba and would recommend buying at levels of support, but i'm not extremely bullish because of concerns over political tensions. If you're interested in a different, strong performing chinese-based e-commerce company, you should consider jd. The stock recently made a new high after posting. An impressive earnings report on the 17th and, if you're looking for a us company that is similar to alibaba, i would recommend either amazon or microsoft.

I like them both a lot. What are your thoughts on alibaba in terms of their upcoming earnings report and as a long-term investment? Let me know in a comment below also, if you have any suggestions or recommendations about what i should cover next feel free to comment that as well. Thanks for watching to this point in the video, i truly appreciate your support if you found value in it. Let me know by hitting the like button if you want to join the moon gang subscribe to the channel and don't forget to turn on your notifications and until next time best of luck in the markets.