Chinese e-commerce giant Alibaba (BABA) is set to report its Q1 FY26 earnings next month, and Wall Street analysts remain bullish on Alibaba (BABA) stock, projecting over 25% upside from current levels. The stock has already jumped over 40% year-to-date, fueled by strength in its AI-driven cloud business and growing momentum in fast delivery services. Looking ahead, analysts expect solid top-line growth in the first quarter, though profit margins may face some pressure due to ongoing investments.
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New Product Launch Adds to Momentum
Alibaba is stepping into the wearable tech space. At a recent event in Shanghai, the company said it will launch its first smart glasses, called Quark AI Glasses, by the end of 2025. The device will use Alibaba’s own language model and include a built-in voice assistant.
The glasses will support real-time translation, voice calls, music streaming, and meeting transcription. This marks Alibaba’s first move into consumer-facing AI gadgets and adds to investor excitement around its broader AI push.
Analysts’ Views on BABA Stock
About 93% of Wall Street analysts remain bullish on Alibaba’s fundamentals, highlighting steady consumer demand during the June quarter. However, many analysts have trimmed their price targets recently due to concerns over shrinking profit margins as Alibaba ramps up spending to stay competitive.
Just last week, Top-rated Mizuho analyst Wei Fang cut his price target from $160 to $149, pointing to rising margin pressure. He noted that competition in China’s local commerce space, especially in food delivery and quick retail, is starting to weigh on profits.
Fang expects Q1 margins to fall sharply from the prior quarter. He also warned that margin strain could persist through 2025 and into 2026 unless regulators step in to ease the pricing war. As a result, Mizuho lowered its Q1 EBITDA forecast from RMB 55 billion to RMB 45 billion and cut its FY27 EBITDA projection to RMB 231 billion.
Is Alibaba Stock a Good Buy Right Now?
Analysts remain highly bullish about Alibaba’s stock trajectory. With 14 Buy ratings and one Hold rating, BABA stock commands a Strong Buy consensus rating on TipRanks. Also, the average Alibaba price target of $151.08 implies about 29% upside potential from current levels.
