Key Stats for Alibaba Stock
- 1-day Price Change for Alibaba stock: 4.6%
- Current Share Price: $180
- 52-Week High: $181
- $BABA Stock Price Target: $183
What Happened?
Alibaba (BABA) stock jumped over 4% on Monday after two major Wall Street firms dramatically raised their price targets, based on the company’s accelerating momentum in AI and cloud businesses.
The rally caps off what’s shaping up to be Alibaba’s best month since its 2019 Hong Kong listing, with shares up nearly 50% in September alone.
Morningstar boosted its fair value estimate for Alibaba stock by 49% to $267 for the ADRs and HK$260 for the Hong Kong shares. Morgan Stanley raised its BABA stock price target by 21% to $200, well above the current trading level.
Both firms cited explosive growth in Alibaba’s cloud division and the company’s aggressive push into artificial intelligence.
The optimism stems from Alibaba’s recent Apsara Conference in Hangzhou, where management laid out a massive spending plan and announced a deeper partnership with Nvidia.
The company is committing RMB 380 billion (approximately $52 billion) over a three-year period to develop AI and cloud infrastructure.
In the June quarter, Alibaba’s cloud revenue accelerated to 26% growth, driven by triple-digit expansion in AI-related products for the eighth straight quarter. AI now accounts for over 20% of external cloud revenue.
Morgan Stanley expects cloud growth to reach 32% in fiscal 2026 and 40% in fiscal 2027, driven by increased spending, model upgrades, and international expansion.
Alibaba released upgraded Qwen3 models in July, including reasoning and coding models that analysts say rank among the world’s best in their categories.
The Qwen3 coder model has driven rapid user adoption overseas. The company also partnered with SAP as its global cloud computing partner, a significant validation of Alibaba’s infrastructure from a Fortune 500 enterprise software giant.
Beyond cloud, Alibaba’s core e-commerce business is showing renewed strength. Customer management revenue grew 10% year-over-year, supported by take-rate improvements and the rapid scaling of its quick commerce business.
Since launching Taobao Instant Commerce in April, the segment has grown to 120 million daily orders and 300 million monthly active users in the quick commerce space. That’s driving 20% growth in daily active users on the Taobao app.
CEO Eddie Wu outlined an ambitious vision during the earnings call: to build a technology platform centered on AI and cloud, and create a comprehensive platform for shopping and daily life services.
Management expects quick commerce alone to add $140 billion in incremental GMV over the next three years.
See analysts’ growth forecasts and price targets for Alibaba stock (It’s free!) >>>
What the Market Is Telling Us About BABA Stock
The 50% monthly gain in Alibaba stock shows investors are finally starting to believe the AI investments will pay off. For years, Alibaba has traded at a steep discount to U.S. tech peers, despite having similar or better growth rates.
Morningstar analyst Chelsey Tam called the shares “undervalued” and highlighted Alibaba’s overseas data center expansion, competitive AI model performance, widespread adoption of its open-source models, and improved performance of its self-developed chips as key drivers of growth.
Morgan Stanley analysts wrote that they are “incrementally bullish on Alicloud’s outlook” and raised cloud growth estimates significantly.
The reopening of positions by Cathie Wood’s Ark Investment Management after a four-year absence is another signal. Ark typically focuses on disruptive innovation, and its return suggests that it views Alibaba as a legitimate AI play, rather than just an e-commerce company navigating regulatory headwinds.
The quick commerce business is still losing money, but management laid out a clear path to profitability. They expect to cut unit economics losses in half through improved customer and order mix, as well as gains in fulfillment efficiency.
More importantly, quick commerce is already driving incremental revenue for the core e-commerce platform through higher traffic and advertising.
Alibaba reported a $53 million loss in adjusted EBITDA on its quick commerce investments this quarter. Moreover, free cash flow was negative $2.64 billion due to the infrastructure buildout.
But with nearly $50 billion in net cash and strong operating cash flow from mature businesses, Alibaba can afford to make these investments.
CFO Toby Xu emphasized that the company has sufficient resources to pursue both the AI and consumption opportunities simultaneously without compromising financial resilience.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
