TLDR
- Jefferies analyst Thomas Chong maintains Buy rating on Alibaba with $230 price target representing 32% upside potential
- Cloud division expected to post 30% year-over-year revenue growth fueled by AI infrastructure demand
- E-commerce customer management revenue forecast to increase 10% on improved traffic and cross-selling
- Quick commerce losses projected to peak in September quarter before showing improvement
- Strong Buy consensus from analysts with 19 Buy ratings and average price target of $192
Jefferies analyst Thomas Chong has maintained his Buy rating on Alibaba stock with a $230 price target. The projection suggests 32% upside from current trading levels.
Chong called Alibaba a “Top Pick for 2026” based on growth drivers in cloud computing and artificial intelligence. The analyst ranks 307th among over 10,000 analysts on TipRanks with a 59% success rate.
His average return per rating stands at 16.50% over one year. Chong described Alibaba as one of Jefferies’ “maximum bullish” ideas for the coming year.
Cloud Revenue Set for Strong Growth
Alibaba Cloud continues expanding rapidly through what the analyst calls “full-stack AI infrastructure.” Jefferies expects cloud revenue to jump 30% year-over-year in the upcoming quarter.
The growth stems from increased GPU chip adoption and rising AI training requirements. Companies across multiple industries are demanding custom data models and switching to GPU computing.
Total revenue growth should reach 2% in the September-ended quarter. This estimate matches consensus forecasts from other Wall Street firms.
The company recently unveiled Qwen3-Max, its largest AI model to date. Alibaba has committed to building new overseas data centers and boosting AI spending.
E-Commerce Strategy Showing Progress
Customer management revenue is forecast to grow 10% year-over-year. Higher website traffic, cross-selling opportunities, and increased purchase frequency drive this growth.
The quick commerce segment delivers groceries and essentials through Taobao and Ele.me platforms. This strategy helps Alibaba compete with rivals like Meituan in the domestic market.
Quick commerce losses should hit their peak in the September quarter. Chong expects results to improve by December as the business model matures.
Jefferies projects a 36 million yuan loss for the International Digital Commerce Group. This comes in below the 41 million yuan consensus estimate.
AliExpress faces competition from Temu and Amazon in international markets. Lazada competes with Shopee and TikTok Shop throughout Southeast Asia.
AI Platform Investments Continue
Alibaba is investing heavily in AI applications including Amap, DingTalk, and Quark. These projects may increase short-term losses but strengthen the product lineup.
Citi Research expects higher costs to appear in adjusted EBITDA figures. The spending supports accelerated AI cloud demand and platform upgrades.
U.S.-listed shares dropped 4% to $173.89 on Thursday. The stock has still gained 77% over the past 12 months on AI enthusiasm.
Of 56 analysts tracked by FactSet, 51 rate Alibaba as Buy or equivalent. Four assign Hold ratings while one rates it Sell.
The consensus price target sits at $191.99, implying 10.54% upside. Citi maintains a Buy rating with a $218 target.
TipRanks shows 19 Buy ratings and two Hold ratings for the stock. Jefferies’ $230 target remains among the highest from major Wall Street firms.
