Alibaba (BABA)
NYSE:BABA
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Alibaba
(NYSE:BABA)
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Rating:69Neutral
Price Target:
$134.00
▲(11.93% Upside)
Action:ReiteratedDate:03/31/26
The score is supported primarily by solid profitability and a strong balance sheet, but is held back by weak cash flow trends and a clearly bearish technical setup. Valuation provides limited support given the higher P/E, while earnings-call guidance is constructive on AI/cloud growth but comes with meaningful near-term margin and free-cash-flow pressure from reinvestment.
Positive Factors
High Profitability
Sustained high gross and net margins indicate durable pricing power and operational efficiency across Alibaba’s commerce and cloud businesses. Strong margins provide internal funding for R&D and strategic reinvestment, supporting multi-year product development and competitive positioning.
Negative Factors
Free Cash Flow Weakness
Severely compressed free cash flow relative to earnings limits discretionary capacity to fund growth, dividends, or buybacks without drawing down reserves. Over the next 2–6 months, low FCF conversion raises funding risk as the company continues heavy AI and logistics reinvestment.
Read all positive and negative factors
Positive Factors
Negative Factors
High Profitability
Sustained high gross and net margins indicate durable pricing power and operational efficiency across Alibaba’s commerce and cloud businesses. Strong margins provide internal funding for R&D and strategic reinvestment, supporting multi-year product development and competitive positioning.
Read all positive factors
Alibaba (BABA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$272.25B
Dividend Yield1.31%
Average Volume (3M)11.36M
Price to Earnings (P/E)36.8
Beta (1Y)0.86
Revenue Growth5.14%
EPS Growth50.76%
CountryUS
Employees124,320
SectorConsumer Cyclical
Sector Strength84
IndustrySpecialty Retail
Share Statistics
EPS (TTM)1.04
Shares Outstanding2,387,412,800
10 Day Avg. Volume10,529,846
30 Day Avg. Volume11,364,916
Financial Highlights & Ratios
PEG Ratio0.23
Price to Book (P/B)2.23
Price to Sales (P/S)2.26
P/FCF Ratio28.84
Enterprise Value/Market Cap8.07
Enterprise Value/Revenue2.17
Enterprise Value/Gross Profit5.27
Enterprise Value/Ebitda13.60
Forecast
1Y Price Target
$185.25Price Target Upside54.74% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering17
EPS Forecast (FY)52.35
Revenue Forecast (FY)$1.15T
Alibaba Business Overview & Revenue Model
Company Description
Alibaba Group Holding Limited, through its subsidiaries, provides technology infrastructure and marketing reach to help merchants, brands, retailers, and other businesses to engage with their users and customers in the People's Republic of China a...
How the Company Makes Money
Alibaba primarily makes money by monetizing commerce activity across its marketplaces and by selling related services to merchants and enterprises. A major revenue stream is customer management and marketing services: merchants and brands pay for ...
Alibaba Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down sales across Alibaba’s various business areas, revealing which segments are contributing most to growth and where there might be potential risks or opportunities.
Breaks down sales across Alibaba’s various business areas, revealing which segments are contributing most to growth and where there might be potential risks or opportunities.
Data provided by:
The Fly
The FlyAlibaba Earnings Call Summary
Earnings Call Date:Mar 19, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:May 14, 2026
Earnings Call Sentiment Neutral
The call presents a balanced picture: strong top‑line growth and clear strategic progress in AI, cloud, Qwen adoption, T‑Head scale and quick commerce expansion contrast with material near‑term profit compression (adjusted EBITA down 57%, GAAP net income down 66%) and reduced free cash flow due to sizable reinvestments. Management frames the profit declines as deliberate, long‑term investment in AI infrastructure, models and instant commerce with multi‑year targets (e.g., >USD 100 billion AI+cloud revenue over 5 years; RMB 1 trillion quick commerce GMV by FY2028). Given robust growth metrics in core strategic areas but significant near‑term margin and cash‑flow impacts, the tone is cautiously optimistic but balanced between opportunity and short‑term execution/cost challenges.Positive Updates
Revenue Growth and Scale
Total consolidated revenue RMB 284.8 billion (like-for-like ex Sun Art and Intime growth ~9% YoY). China e-commerce revenue RMB 159.3 billion, up 6% YoY. Quick commerce revenue grew 56% YoY to RMB 20.8 billion. Operating cash flow was an inflow of RMB 36 billion; free cash flow was RMB 11.3 billion. Net cash of USD 42.5 billion (net position > USD 60 billion excluding maturities beyond 5 years).
Negative Updates
Large Decline in Adjusted EBITA and GAAP Net Income
Total adjusted EBITA decreased 57% YoY, primarily due to strategic investments in AI, cloud and quick commerce. GAAP net income decreased 66% YoY to RMB 15.6 billion. Management attributes declines to heavy reinvestment rather than core demand deterioration.
Read all updates
Q3-2026 Updates
Positive
Negative
Revenue Growth and Scale
Total consolidated revenue RMB 284.8 billion (like-for-like ex Sun Art and Intime growth ~9% YoY). China e-commerce revenue RMB 159.3 billion, up 6% YoY. Quick commerce revenue grew 56% YoY to RMB 20.8 billion. Operating cash flow was an inflow of RMB 36 billion; free cash flow was RMB 11.3 billion. Net cash of USD 42.5 billion (net position > USD 60 billion excluding maturities beyond 5 years).
Read all positive updates
Company Guidance
The company’s forward guidance emphasized heavy investment in AI+cloud and consumption with concrete targets and near-term expectations: a five‑year goal to surpass USD 100 billion in combined cloud and AI (including MaaS) external revenue; Cloud Intelligence Group external revenue accelerating to ~35–36% year‑over‑year (up from 29% last quarter) with AI‑related product revenue delivering triple‑digit YoY growth for the tenth consecutive quarter, Cloud market share rising to 36%, and Alibaba Cloud cumulative external revenue through Feb FY26 exceeding RMB 100 billion while cloud adjusted EBITA margin stayed around 9%; token consumption on Model Studio grew 6x in the past three months and MaaS is expected to become Cloud’s largest product; T‑Head has cumulatively shipped 470,000 AI chips (over 60% to external customers), supporting 400+ enterprise customers and generating ~RMB 10 billion annual revenue with capacity set to expand into 2026–27; Qwen consumer MAU surpassed 300 million and Qwen models exceeded 1 billion downloads on Hugging Face; quick commerce revenue rose 56% to RMB 20.8 billion with a target of >RMB 1 trillion GMV by FY28 (positive cash flow at that scale and profitability targeted in FY29); consolidated revenue was RMB 284.8 billion (like‑for‑like +9%), total adjusted EBITA down 57%, GAAP net income RMB 15.6 billion (‑66%), operating cash flow RMB 36 billion, free cash flow RMB 11.3 billion (down RMB 27.7 billion), net cash USD 42.5 billion (net position >USD 60 billion excluding long‑dated maturities), while China e‑commerce revenue was RMB 159.3 billion (+6%) with adjusted EBITA RMB 34.6 billion (‑43%) and “All Others” revenue fell 25% to RMB 67.3 billion with an adjusted EBITA loss of RMB 9.8 billion.Alibaba Financial Statement Overview
Summary
Income Statement
85
Very Positive
Balance Sheet
78
Positive
Cash Flow
65
Positive
| Breakdown | TTM | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.01T | 996.35B | 941.17B | 868.69B | 853.06B | 717.29B |
| Gross Profit | 416.69B | 398.06B | 354.85B | 318.99B | 313.61B | 296.08B |
| EBITDA | 161.59B | 182.67B | 164.01B | 153.11B | 128.23B | 217.96B |
| Net Income | 123.35B | 130.11B | 80.01B | 72.78B | 62.25B | 150.58B |
Balance Sheet | ||||||
| Total Assets | 1.88T | 1.81T | 1.77T | 1.75T | 1.70T | 1.69T |
| Cash, Cash Equivalents and Short-Term Investments | 373.57B | 464.77B | 602.17B | 557.62B | 491.06B | 517.56B |
| Total Debt | 281.59B | 248.49B | 205.69B | 195.63B | 176.85B | 181.68B |
| Total Liabilities | 772.10B | 715.21B | 652.46B | 630.33B | 614.25B | 607.40B |
| Stockholders Equity | 1.03T | 1.01T | 986.89B | 990.03B | 949.90B | 938.77B |
Cash Flow | ||||||
| Free Cash Flow | 2.63B | 78.16B | 150.82B | 165.52B | 87.95B | 181.96B |
| Operating Cash Flow | 127.98B | 164.82B | 184.01B | 199.90B | 140.39B | 223.63B |
| Investing Cash Flow | -203.77B | -206.61B | -26.27B | -137.20B | -190.54B | -235.79B |
| Financing Cash Flow | 21.78B | -57.12B | -104.81B | -64.07B | -68.13B | 29.21B |
Alibaba Technical Analysis
Negative
119.72
Price Trends
143.50
Negative
150.44
Negative
146.39
Negative
Market Momentum
-5.63
Negative
42.08
Neutral
33.16
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BABA, the sentiment is Negative. The current price of 119.72 is below the 20-day moving average (MA) of 127.54, below the 50-day MA of 143.50, and below the 200-day MA of 146.39, indicating a bearish trend. The MACD of -5.63 indicates Negative momentum. The RSI at 42.08 is Neutral, neither overbought nor oversold. The STOCH value of 33.16 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BABA.
Alibaba Risk Analysis
Alibaba disclosed 70 risk factors in its most recent earnings report. Alibaba reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Alibaba Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $90.03B | 51.14 | 33.73% | ― | 38.01% | 44.52% | |
70 Outperform | $144.44B | 11.47 | 26.44% | ― | 12.53% | -6.43% | |
69 Neutral | $272.25B | 36.81 | 8.82% | 1.31% | 5.14% | 50.76% | |
69 Neutral | $2.38T | 31.67 | 21.87% | ― | 11.48% | 50.70% | |
67 Neutral | $41.49B | 14.55 | 8.57% | 3.37% | 16.54% | -3.61% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
53 Neutral | $35.98B | 206.19 | 4.52% | ― | 16.63% | -62.54% |
* Consumer Cyclical Sector Average
BABA
Alibaba
125.32
22.26
21.60%
AMZN
Amazon
221.25
30.15
15.78%
MELI
Mercadolibre
1,775.74
-204.92
-10.35%
JD
JD
29.05
-6.03
-17.18%
PDD
PDD Holdings
103.75
9.60
10.20%
CPNG
Coupang
19.68
-2.16
-9.89%
Alibaba Corporate Events
Alibaba Keeps Share Capital Stable in February 2026 Hong Kong Monthly Return
Mar 3, 2026
Alibaba Group Holding Limited reported to the U.S. Securities and Exchange Commission on March 3, 2026 that, as part of its obligations as a Hong Kong–listed issuer, it submitted a monthly return to the Hong Kong Stock Exchange covering shar...
Alibaba Reports Minimal Share Issuance and Confirms Public Float in January 2026 Monthly Return
Feb 4, 2026
On February 4, 2026, Alibaba Group Holding Limited filed a Form 6-K with the U.S. Securities and Exchange Commission and submitted its monthly return to the Hong Kong Stock Exchange for the month ended January 31, 2026, detailing movements in its ...
Alibaba Reports December 2025 Share Capital Movements and Potential Dilution in Hong Kong Filing
Jan 7, 2026
On January 7, 2026, Alibaba Group filed a Form 6-K with the U.S. Securities and Exchange Commission to furnish its mandatory monthly return to the Hong Kong Stock Exchange covering share capital movements for December 2025. The filing shows that w...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.