Alibaba (BABA) AI Stock Analysis

• Market Cap: $293.91B
• Dividend Yield: 0.01%
• Average Volume (3M): 13.63M
• Price to Earnings (P/E): 16.1
• Beta (1Y): 0.67
• Revenue Growth: 5.17%
• EPS Growth: 74.55%
• Country: US
• Employees: 124,320
• Sector: Consumer Cyclical
• Sector Strength: 71
• Industry: Specialty Retail
• EPS (TTM): 1.75
• Shares Outstanding: 2,385,348,900
• 10 Day Avg. Volume: 18,224,435
• 30 Day Avg. Volume: 13,630,852
• PEG Ratio: 1.73
• Price to Book (P/B): 1.77
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 27.92
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $151.81
• Price Target Upside: 25.31% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 15

• Rating: 79 Outperform
• Price Target: $134.00 ▲(10.61%Upside)

Alibaba's overall stock score is driven primarily by strong financial performance and positive earnings guidance, particularly in AI and cloud growth. The valuation also supports the score, though technical analysis indicates a neutral trend. Challenges in traditional commerce and cash flow are notable, but the strategic focus on high-growth sectors offsets these concerns.

Positive Factors

AI and Cloud Infrastructure

BABA's positioning as a leading GenAI and cloud infrastructure provider remains unchanged, supporting a positive long-term outlook.

E-commerce Growth

The merger of Ele.me and Fliggy into BABA's China ecommerce business group, if well executed, could drive long-term growth in core commerce.

Financial Strength

BABA's financial strength provides the flexibility to scale, adapt, and potentially increase user engagement over time.

Negative Factors

Earnings Disruption

Lower price objective to US$135 on near-term earnings disruption.

Near-term Margins

The RMB 50B investment plan is likely to weigh on near-term margins, reflecting potential short-term margin volatility.

Profitability Challenges

Heightened investment in instant commerce is expected to weigh on near-term profitability.

Alibaba Business Overview & Revenue Model

Company Description

Alibaba Group Holding Limited, founded in 1999, is a leading Chinese multinational conglomerate specializing in e-commerce, retail, internet, and technology. It operates various business units including online retail platforms such as Taobao, Tmall, and AliExpress, as well as cloud computing through Alibaba Cloud, digital media and entertainment, and logistics via Cainiao Network. Alibaba is headquartered in Hangzhou, China, and is renowned for its comprehensive ecosystem that connects buyers and sellers globally, providing a wide range of services to facilitate trade and commerce.

How the Company Makes Money

Alibaba primarily makes money through its core commerce segment, which encompasses its retail marketplaces like Taobao and Tmall, where it charges merchants for listings, advertisements, and value-added services. The company also earns substantial revenue from its cloud computing division, Alibaba Cloud, which provides a suite of services such as data storage, processing, and analytics. Additionally, Alibaba's digital media and entertainment arm, including platforms like Youku Tudou, contributes to its income through advertising, subscriptions, and content distribution. The firm's logistic network, Cainiao, enhances its e-commerce operations by providing efficient delivery and supply chain solutions. Key partnerships with international brands and expansion into new geographical markets further bolster its revenue streams.

Alibaba Financial Statement Overview

Summary

Alibaba presents a strong financial position with consistent revenue growth, healthy profit margins, and robust cash flow management. The income statement and cash flow indicators show excellent profitability and cash conversion, while the balance sheet reflects a solid equity base with manageable leverage.

Income Statement

Alibaba demonstrates strong income statement metrics with a consistent revenue growth rate of approximately 5.9% in 2025 compared to 2024. The company maintains healthy profit margins, with a gross profit margin at approximately 39.9% and a net profit margin at 13.1% for the latest fiscal year. The EBIT margin is robust at 14.1%, indicating efficient operational management. EBITDA margins also remain strong at 18.3%. These factors suggest a stable and profitable income statement performance.

Balance Sheet

Alibaba's balance sheet reflects a favorable equity ratio of 55.9%, indicating a strong equity position. The debt-to-equity ratio is reasonable at 0.25, showing balanced leverage. Return on Equity (ROE) is strong at 12.9%, demonstrating effective use of shareholder funds to generate profit. Although the company maintains a solid equity base, the growth in liabilities requires monitoring to ensure long-term financial stability.

Cash Flow

The cash flow statement indicates a positive trajectory with stable free cash flow, despite a 48.2% decline in free cash flow in 2025 compared to 2024. The operating cash flow to net income ratio is favorable at 1.26, demonstrating strong cash generation from operations. The free cash flow to net income ratio stands at 0.60, highlighting efficient cash conversion. Overall, Alibaba's cash flow management remains robust amid investment activities.

Breakdown	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	996.35B	941.17B	868.69B	853.06B	717.29B
Gross Profit	398.06B	354.85B	318.99B	313.61B	296.08B
EBITDA	182.67B	164.01B	153.11B	128.23B	217.96B
Net Income	130.11B	80.01B	72.78B	62.25B	150.58B
Balance Sheet
Total Assets	1.80T	1.76T	1.75T	1.70T	1.69T
Cash, Cash Equivalents and Short-Term Investments	428.09B	571.03B	524.47B	455.08B	483.44B
Total Debt	248.35B	205.61B	161.35B	141.34B	149.15B
Total Liabilities	714.12B	652.23B	630.12B	613.36B	606.58B
Stockholders Equity	1.01T	986.54B	989.66B	948.48B	937.47B
Cash Flow
Free Cash Flow	77.54B	149.66B	165.40B	89.44B	188.60B
Operating Cash Flow	163.51B	182.59B	199.75B	142.76B	231.79B
Investing Cash Flow	-185.41B	-21.82B	-135.51B	-198.59B	-244.19B
Financing Cash Flow	-76.22B	-108.24B	-65.62B	-64.45B	30.08B

Alibaba Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 121.15
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BABA, the sentiment is Positive. The current price of 121.15 is above the 20-day moving average (MA) of 113.47, above the 50-day MA of 116.11, and above the 200-day MA of 107.93, indicating a bullish trend. The MACD of 1.71 indicates Negative momentum. The RSI at 61.29 is Neutral, neither overbought nor oversold. The STOCH value of 88.95 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BABA.

Alibaba Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BABA	79 Outperform	$293.91B	16.05	13.04%	0.01%	5.17%	74.55%
PDD	78 Outperform	$164.51B	12.76	36.31%	―	35.04%	22.04%
SE	78 Outperform	$93.88B	111.51	11.13%	―	30.18%	1995.22%
JD	77 Outperform	$54.65B	8.28	19.81%	0.09%	8.13%	91.39%
CPNG	74 Outperform	$55.45B	220.82	6.06%	―	20.88%	-80.08%
AMZN	73 Outperform	$2.42T	37.23	25.24%	―	10.08%	71.88%
Sector *	63 Neutral	$17.10B	10.79	-8.01%	2.94%	1.62%	-25.73%