By Nate Wolf

Alibaba Group shares were rising Tuesday after the Chinese technology and e-commerce company got a wave of price-target boosts from Wall Street following its fiscal first-quarter earnings report.

Alibaba's headline metrics were mixed. Revenue came in lower than analysts expected and earnings before interest, taxes, depreciation, and amortization fell 11% from the year prior.

But the stock closed up 19% Monday in Hong Kong trading as artificial-intelligence revenue more than doubled from the previous year.

The latter figure has left some analysts optimistic about the company's ability to outcompete Chinese peers like DeepSeek, Baidu, and Tencent in the country's AI arms race. "BABA holds the best Cloud assets in China, positioning it to capitalize on strong AI demand," wrote Wei Fang of Mizuho Securities in a research note.

Chinese firms are investing heavily in generative AI to improve efficiency and find new ways to put the technology to work, Fang wrote, saying Alibaba's cloud-computing revenue should grow at an even faster pace over the next couple of quarters. At the same time, the company's core e-commerce business is performing well, Mizuho said.

Mizuho reiterated an Outperform rating for the stock and lifted its price target to $159 from $149. Alibaba's American depositary receipts were up 0.8% to $136.10 in premarket trading Tuesday.

Analysts at Benchmark Equity Research had a similar take. They maintained a Buy rating on Alibaba stock and boosted their target price to $195 from $176. "We believe fundamentals are clearly strengthening across its cloud and e-commerce segments," wrote Benchmark's Fawne Jiang and Long Lin in a research note.

Alibaba's investments in so-called quick commerce -- an on-demand delivery service -- have weighed on margins. But the model has the potential to have customers make purchases more often while encouraging them to keep using Alibaba, as well as boosting advertising revenue, Benchmark argued.

At the same time, the company has solidified its position as China's top generative AI and cloud infrastructure provider, the firm said. And Alibaba's plan for additional capital investments in AI over the next three years "positions it well for sustained growth," Jiang and Lin wrote.

Of the 32 analysts polled by FactSet since Alibaba's earnings print, 20 have boosted their price targets for the stock.

Write to Nate Wolf at nate.wolf@barrons.com

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September 02, 2025 08:55 ET (12:55 GMT)

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