Alibaba’s Q1 Performance and Analyst Reactions
Alibaba Group Holding Limited (BABA), the prominent Chinese e-commerce company, saw its stock surge by 12.9% after unveiling robust fiscal first-quarter results for 2026 on August 29. Despite reporting a revenue of 247.7 billion yuan ($34.6 billion) that fell short of the anticipated 252.9 billion yuan, the company’s profit exceeded projections. Notably, cloud revenue experienced a significant 26% year-over-year increase, reaching 33.4 billion yuan. Adjusted earnings per American Depositary Share (ADS) were reported at $2.06, surpassing the consensus estimate of $1.98.
Investor Insights and Price Target Increases
In the wake of these encouraging results, several analysts from Wall Street have revised their price targets for Alibaba, highlighting the company’s expanding cloud business and its increasing involvement in artificial intelligence (AI).
Goldman Sachs Analysis
Goldman Sachs analyst Ronald Keung elevated his price target for Alibaba from $147 to $163 while maintaining a Buy rating. He acknowledged that the company’s quick commerce sector is expected to report greater losses in the upcoming September quarter. However, he anticipates these losses will diminish by December as Alibaba shifts its focus toward higher-quality users, reduces subsidies, and enhances delivery efficiency. Keung emphasized Alibaba’s strategy to evolve into an “AI + everyday consumption app” and an “AI + Cloud hyperscaler.”
JPMorgan Perspective
Similarly, JPMorgan analyst Alex Yao raised his price target from $140 to $170, keeping an Overweight rating in place. Yao remarked that Alibaba’s food delivery and quick commerce services are now sufficiently established to operate more efficiently, akin to Meituan, a leading Chinese food delivery firm. He projected that increased orders and a larger delivery workforce could lead to reduced losses over the subsequent quarters, with Alibaba’s food delivery service, Ele.me, potentially becoming profitable in the future.
Bernstein’s Outlook
Bernstein analyst Robin Zhu also increased his price target for Alibaba, moving it from $145 to $160 while retaining an Outperform rating. Zhu highlighted the company’s impressive Q1 results, noting that Alibaba has amassed 300 million monthly quick commerce customers and has over 2 million daily riders contributing to 80 million daily orders. He indicated that losses within Alibaba’s food delivery segment could be halved by October, forecasting that the upcoming second quarter might represent the high point for expenditure.
Overall Market Sentiment
Analysts maintain an optimistic outlook for Alibaba’s stock performance. The company currently boasts 12 Buy ratings and a single Hold rating, further solidifying its Strong Buy consensus rating on TipRanks. The average price target across analysts stands at $152.63, suggesting a potential upside of approximately 13.06% from current trading levels.
