Dr. Stoxx Says Alibaba Is a 'Sell The News' Play

Dr. Thomas Carr, founder of DrStoxx.com, suggested to Benzinga that investors use Alibaba Group Holding Ltd's BABA earnings report as a "sell the news" play.

Carr noted that last quarter, Alibaba's earnings report fell a nickel short of expectations, causing shares to slide from $120 to a low near $95.

"This time things should be different," Carr told Benzinga via email. "Remember Singles Day? It beat revenue expectations by over $1 billion, with a 60 percent year over year sales growth, which has had the analysts all scrambling to raise consensus targets."

Carr added that Alibaba should easily report a top-line beat, but investors should still pay attention to the firm's monetization rates as there is some concern that it will be lower than it was a quarter a quarter.

Bottom line, "this may be a sell the news play."

In Thursday's premarket, Alibaba reported EPS of $0.81, beating expectations of $0.74.