Alibaba Group is scheduled to release its next earnings report on Jan. 29, and analysts are starting to release their expectations for the fiscal third quarter of 2015. Unsurprisingly, most firms remain positive on the company going into this month’s print.

Alibaba Group Holding Ltd Earnings Preview: Still A Top Pick

Morgan Stanley thinks Alibaba shares look attractive

In a report dated Jan. 21, Morgan Stanley analyst Angela Moh and her team provided their projections and said the Chinese e-commerce giant’s stock remains one of their top picks. In particular, they think the recent retreat in Alibaba’s share price means the price to earnings ratio for the 2015 calendar year estimates is now 36 times, which they think makes the stock look attractive.

In their model, they included a deceleration in gross merchandise volume growth. They see possible upside in this metric if users adopt Alibaba more quickly than expected or if they spend more than expected on the company’s online retail properties.

What to expect in Alibaba’s earnings report

The Morgan Stanley team is looking for non-GAAP net profits of 11 billion yuan, a 6% year over year increase. They’re projecting a decline in Alibaba’s gross margin to offset the expected 46% year over year increase in revenue. That would result in a 22% growth rate in non-GAAP operating profit.

The analysts expect to see total Chinese gross merchandise volume of 759 billion yuan, a 43.5% year over year growth rate. They believe the mix shift will continue to move toward Alibaba’s Tmall online property and spending on mobile devices. They’re looking for continued improvements in mobile monetization as well, plus stable PC monetization, which should result in a bit of an improvement in blended monetization.

Possible upside to Alibaba’s current quarter

Alibaba typically sees a benefit from Chinese New Year, which happens in late February this year. Last year, the holiday happened in the end of January. As a result, the Morgan Stanley team thinks the decline in gross merchandise volume between the third and fourth fiscal quarters won’t be as bad as it usually is.

Their estimates suggest a 20% sequential decline, which is similar to last year’s decline. They say this means there could be potential upside to their gross merchandise volume estimate for Alibaba’s fourth fiscal quarter. The analysts add though that “greater efforts to clear ‘fictional’ transactions on its platforms” could offset any potential upside.

Looking ahead to this year

This year they expect Alibaba to focus on improving the leverage of its data and improving the mobile purchase experience. They also want to see more professional teams help deepen Alibaba’s many verticals and progress in expansion in the e-commerce giant’s ecosystem and ad revenue through Ants Financial and AliCloud. Additionally, they expect Alibaba to continue with its international mergers and acquisitions strategy and keep cracking down on fake transactions.

Shares of Alibaba Group rose by as much as 3.6% during regular trading hours today.