Alibaba Group's Stock Rises Over 100%, Cloud Business Grows 34%
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Source: Fool
- Cloud Business Growth: Alibaba's Cloud Intelligence Group achieved a 34% year-over-year growth in the latest quarter, driving total revenue to $34.8 billion, with a 15% increase excluding disposed businesses, showcasing strong demand fueled by AI advancements and solidifying its market position.
- Improving Policy Environment: The Chinese government's emphasis on digital transformation in its 15th five-year plan, expected to be reviewed in March, provides policy support for Alibaba's e-commerce, cloud computing, and AI businesses, aiding the company's future growth prospects.
- Attractive Investment Value: Alibaba's price-to-earnings ratio has risen from 11.6 times a year ago to nearly 23 times, while not undervalued, it remains attractive compared to its five-year average of 27.6 times and American tech companies, offering a good entry point for long-term investors.
- AI Infrastructure Investment: Alibaba plans to invest approximately $53 billion in AI infrastructure over the next two to three years, primarily to expand data centers and enhance the competitiveness of its cloud services, further strengthening its position in the rapidly evolving AI market.
Analyst Views on BABA
Wall Street analysts forecast BABA stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for BABA is 198.21 USD with a low forecast of 152.00 USD and a high forecast of 240.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
21 Analyst Rating
19 Buy
2 Hold
0 Sell
Strong Buy
Current: 170.930
Low
152.00
Averages
198.21
High
240.00
Current: 170.930
Low
152.00
Averages
198.21
High
240.00
About BABA
Alibaba Group Holding Ltd is an investment holding company mainly engaged in the provision of technology infrastructure and marketing platforms. The Company operates its business through nine segments. The China Commerce Retail segment is engaged in the China commerce retail business. The China Commerce Wholesale segment is mainly engaged in the operation of 1688.com. The Cloud Intelligence segment provides cloud services. The International Commerce Retail segment provides customer management services, sales of goods and logistics services. The International Commerce Wholesale segment is mainly engaged in the operation of Alibaba.com. The Cainiao Represents Logistics Services segment provides fulfilment services. The Local Services segment’s revenue includes platform commissions, logistics services revenue. The Digital Media and Entertainment segment engages in the operation of Youku and Alibaba. The All Others segment is mainly engaged in the Sun Art, Freshippo and other business.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
