Update shared on12 Sep 2025
Fair value Increased 2.10%Analysts have raised Alibaba’s price target to $165.48, citing accelerating cloud and AI-driven revenue growth, improved execution and synergies in quick commerce, margin expansion, and diversification into new verticals, all underpinning stronger long-term fundamentals.
Analyst Commentary
- Bullish analysts cite accelerating cloud revenue growth, particularly with robust AI-related and external revenue contributions, solidifying Alibaba’s position as China’s leading GenAI and cloud infrastructure provider.
- Enhanced execution in quick commerce, with significant user growth and operational improvements, is resulting in increased synergies, improved efficiency, and is expected to reach profitability inflection as investment peaks.
- Updates to FY25-FY28 earnings estimates reflect stronger fundamentals across key segments, with raised profitability expectations driven by margin improvements and business mix optimization.
- Bullish analysts highlight Alibaba’s ongoing expansion into new verticals—such as innovative life services—supported by product launches and early growth strategies to diversify revenue sources.
- Recent quarterly reports, though meeting or slightly missing consensus due to investment uptick and asset divestitures, have addressed investor concerns with management guidance projecting sustained, visible growth momentum across e-commerce and cloud segments.
What's in the News
- Alibaba and Baidu have begun partially replacing Nvidia AI chips with their own internally developed chips due to U.S. export restrictions, signaling a likely continued decline in Nvidia's China business (The Information).
- Despite Beijing regulators discouraging purchases, Alibaba and other Chinese firms still seek Nvidia's AI chips, monitoring shipments and upcoming product plans closely (Reuters).
- Alibaba has developed a new, versatile chip as a substitute for banned Nvidia products; however, Chinese companies remain technologically behind U.S. chipmakers (Wall Street Journal).
- Alibaba plans to spin off its Banma Network Technology (autonomous driving business) through a Hong Kong IPO, reducing its stake from ~45% to 15% (South China Morning Post).
- Alibaba is integrating food delivery platform Ele.me and online travel agency Fliggy into its core e-commerce unit as part of a strategic transformation towards a more comprehensive consumer platform (Reuters).
Valuation Changes
Summary of Valuation Changes for Alibaba Group Holding
- The Consensus Analyst Price Target has risen slightly from $162.07 to $165.48.
- The Future P/E for Alibaba Group Holding has significantly fallen from 19.47x to 2.80x.
- The Net Profit Margin for Alibaba Group Holding has risen slightly from 13.58% to 14.04%.
Disclaimer
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