Trump says Iran war "close to over" amid hopes for more negotiations
Investing.com - Macquarie lowered its price target on Alibaba Group Holding Ltd (NYSE:BABA) to $175.90 from $176.20 while maintaining an Outperform rating on the stock. The shares currently trade at $127.68, down 26% over the past six months, though InvestingPro data suggests the stock remains undervalued at current levels.
The firm expects cloud to remain important for Alibaba in the fourth quarter as accelerated growth is supported by increasing enterprise adoption and token consumption. Customer management revenue is expected to trend weaker as more branded merchant engagement occurs.
Qwen continues to narrow losses with reduced spending and an improved mix. The firm reduced its earnings estimates after factoring in added investment from Qwen and continued training costs.
Macquarie trimmed its sum-of-the-parts-based price target by less than 1% to $175.90 for the U.S.-listed shares and HK$171.10 for Hong Kong-listed shares, from $176.20 and HK$171.30 respectively. The firm kept its target multiples unchanged.
The firm reiterated its Outperform rating and Marquee Buy designation on Alibaba, citing solid progress in artificial intelligence.
In other recent news, Alibaba Group Holding Ltd. reported third-quarter fiscal results with revenue and profitability falling below expectations. Susquehanna lowered its price target for Alibaba from $190 to $170, citing increased investments in strategic growth areas like Quick Commerce and AI + Cloud offerings as factors affecting profitability. Meanwhile, Morgan Stanley maintained an Overweight rating and a $180 price target, highlighting the potential for cloud growth driven by a recent price increase. The firm expects Alibaba’s cloud margins to remain robust in the long term at 20%.
Additionally, Alibaba launched its next-generation AI chip, the XuanTie C950, which boasts performance more than three times faster than its predecessor. This 5-nanometer processor, built on open-source RISC-V architecture, is designed to reduce Alibaba’s reliance on external suppliers. Morgan Stanley reiterated its Overweight rating following the chip’s launch, emphasizing its strategic importance for future monetization. Alibaba’s focus on developing its Qwen App is also seen as a crucial step for future growth opportunities.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.
