Nio vs. Alibaba (BABA): Which Chinese Stock Is the Better Pick After Earnings?

Chinese stocks remain in focus as investors look for signs of stability in the world’s second-largest economy. Both Alibaba (BABA) and Nio (NIO) have recently reported their latest earnings, giving the market a clearer view of how e-commerce and electric vehicles are holding up in China’s uncertain recovery. While Alibaba showed strength in cloud and AI-driven growth, Nio continued to face pressure from slowing margins and fierce EV competition. Now that the quarterly earnings are behind us, many investors are weighing if Alibaba or Nio is the stronger stock to own in 2025.

For context, Alibaba is China’s e-commerce giant with a fast-growing cloud and AI business, while Nio is an electric vehicle maker competing in a crowded EV market. Year-to-date, NIO stock has gained by roughly 51%, while BABA shares have gained 66%.

Is NIO a Good Stock to Buy?

Nio recently released its second-quarter earnings results. The company reported quarterly sales of $2.65 billion, up 9% year-over-year but below the consensus estimate of $2.73 billion. Adjusted earnings per ADS came in at $0.32, slightly ahead of the $0.31 forecast. Meanwhile, Nio delivered 72,056 vehicles, up 25.6% from last year and nearly 71% higher than Q1 FY25. For the third quarter, the company projects Q3 revenue of $3.04 billion to $3.19 billion, an increase of 16.8% to 22.5% year-over-year.

Following the results, US Tiger Securities analyst Bo Pei raised his price target to $8 from $5 (21.6% upside) and kept a Buy rating. He said near-term profits remain limited, but the outlook for the second half is stronger with rising volumes and better margins from the ONVO L90 and ES8. Pei added that the 2026 models — ONVO L80, ES9, and ES7 — could drive further growth if they match the success of the L90 and ES8. He said execution on these launches will be key for Nio to move from a turnaround to a growth story.

Is Alibaba a Good Stock to Buy?

Meanwhile, Alibaba also reported mixed Q1 FY26 earnings results. Revenue fell short of Wall Street estimates, but stronger profit and momentum in cloud and AI lifted the stock. Since its earnings release on August 29, shares are up 2.6%.

For the quarter, Alibaba posted revenue of 247.7 billion yuan ($34.6 billion), up 2% year-over-year but below the consensus of 252.9 billion yuan. Adjusted earnings per ADS came in at $2.06, above expectations of $1.98, helped by cost controls and better margins in non-core units. The Cloud Intelligence Group was the highlight, with revenue up 26% to 33.4 billion yuan, driven by rising enterprise demand for AI services and steady growth in China’s internet sector.

Following the earnings results, several Wall Street analysts raised their price targets, citing Alibaba’s growing cloud business and rising role in AI. For instance, Goldman Sachs analyst Ronald Keung raised his price target on Alibaba to $163 from $147 while keeping a Buy rating on the back of faster international e-commerce recovery and stronger growth in the cloud. He said Alibaba’s new focus is on becoming an “AI + everyday consumption app” and an “AI + Cloud hyperscaler.”

NIO or BABA: Which Stock is a Better Buy, According to Analysts? 

Using TipRanks’ Stock Comparison Tool, we compared NIO and BABA to see which AI stock analysts favor. Alibaba holds a Strong Buy rating with a price target of $161.30, suggesting 16% upside from current levels. In contrast, Nio carries a Moderate Buy rating, and its price target of $5.59 points to a 15% downside from the current price.

Conclusion 

Post their quarterly earnings results, Wall Street sees more upside in Alibaba than in Nio. Analysts highlight Alibaba’s strong e-commerce base and its growing cloud and AI businesses as key drivers of future growth.

Nio, meanwhile, continues to improve on volumes and product launches, but margin pressure and heavy competition keep its outlook less certain. This leaves BABA as the stronger pick in the near term, according to the analysts.