Alibaba's Q2 Earnings Beat Puts These ETFs In Focus

Chinese e-commerce giant Alibaba Group (BABA - Free Report) reported mixed second-quarter fiscal 2020 results before the opening bell on Nov 1 wherein it beat earnings but lagged revenue expectations.

Earnings of $1.83 per ADS beat the Zacks Consensus Estimate by 28 cents and were up 36% year over year. Revenues climbed 40% year over year to $16.65 billion but fell shy of the estimated $16.72 billion. The robust results were driven by growth in its core e-commerce and cloud computing businesses. Core e-commerce revenues grew 40% year over year, cloud computing revenues soared 64%, and digital media and entertainment revenues increased 23%.

Annual active consumers increased 19 million from the last quarter to reach 693 million in September. Mobile monthly active users in its China retail marketplaces increased 30 million quarter over quarter to 785 million.

Alibaba currently has a Zacks Rank #3 (Hold) and a VGM Score of D. It belongs to a top-ranked Zacks industry (top 33%).

ETFs in Focus

ETFs having the highest allocation to the Chinese e-commerce giant will be in focus in the days ahead. Below, we have highlighted six ETFs in detail:

Invesco BLDRS Emerging Markets 50 ADR Index Fund (ADRE - Free Report)
 
The product offers exposure to 50 emerging market-based depositary receipts by tracking the BNY Mellon Emerging Markets 50 ADR Index. About 42.3% of the portfolio is allotted to Chinese firms with Alibaba occupying the top position at 20.3%. Taiwan, Brazil, and India round off the next three spots in terms of country exposure. Consumer discretionary, information technology, financials and communication services are the top four sectors. ADRE has amassed $179.8 million in its asset base while trading in light volume of about 5,000 shares. It charges 18 bps in fees per year and has a Zacks ETF Rank #4 (Sell) with a Medium risk outlook.

Invesco BLDRS Asia 50 ADR Index Fund (ADRA - Free Report)

This ETF follows the capitalization-weighted BNY Mellon Asia 50 ADR Index and tracks the performance of approximately 50 Asian market-based DRs. Alibaba occupies the top position with 15.7% allocation. Japanese firms make up for the largest share at 33.1% while Chinese firms account for 32.3% of the assets. ADRA is often overlooked by investors as evident from its AUM of $17.7 million and average daily volume of about 1,000 shares. It charges 30 bps in annual fees and has a Zacks ETF Rank #3 with a Medium risk outlook.

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