The Chinese market has seemingly been teetering on the brink of collapse since the COVID-19 pandemic, with bloodbaths being particularly notable in early 2024.
I upgrade Alibaba to a 'Strong Buy' with a one-year target price of $174, driven by growth in AI, cloud computing, and government subsidies. Alibaba's recent results show recovery, with 7.6% revenue growth and 6.5% adjusted net income growth, supported by Chinese government policies boosting domestic consumption. Management plans substantial CAPEX in AI and cloud computing, with investments exceeding the past decade's total, enhancing future growth prospects.
Shares of major Chinese tech and consumer stocks such as tech conglomerates Alibaba (BABA -4.32%) and Tencent (TCEHY -5.01%), as well as digital online broker Futu Holdings (FUTU -5.01%) were all falling today. They were down 4.3%, 5.6%, and 5.2%, respectively, as of 1:49 PM ET.
I am upgrading Alibaba stock from sell to buy due to its strong appreciation and reevaluation of trade war and AI market challenges. Despite initial concerns, Alibaba's AI and cloud investments, along with China's protective stance, present significant growth opportunities in the domestic market. Alibaba's latest earnings exceeded expectations, with notable growth in cloud and digital commerce, driven by AI-related products.
China's leading economic and business conditions indicators paint a favorable macro backdrop for Alibaba's Commerce and Cloud Intelligence businesses. Alibaba is investing significantly in AI and cloud computing, with good execution traction. This can be a long-term revenue growth driver, particularly in the Cloud Intelligence Group. The upcoming AliExpress sale season is likely to boost AIDC revenues for the Mar'25 quarter.
2025 has turned out to be the most exciting year for Alibaba's (BABA 0.37%) investors. The stock has surged 68% (as of this writing), reaching a level unseen since 2021.
Alibaba (BABA) reachead $143.20 at the closing of the latest trading day, reflecting a +0.32% change compared to its last close.
Though his name lost some of its luster with the ‘sell' recommendation for S&P 500 and other U.S. stocks right before the index started one of its strongest bull cycles and with a poorly-timed bet against the semiconductor industry, Michael Burry might have taken the most decisive victory over the 2025 market.
Alibaba (BABA) has received quite a bit of attention from Zacks.com users lately. Therefore, it is wise to be aware of the facts that can impact the stock's prospects.
Investors target stocks that are witnessing a bullish run. Some of the stocks seeing price strength are DRD, WGS, EVER, HCI, BABA.
The Chinese stock market is on fire and the rally is gathering momentum—in stark contrast to U.S. equities right now.
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