TLDR
- Jefferies analyst Thomas Chong reaffirmed a Buy rating on Alibaba stock with a $230 price target, calling it a “Top Pick for 2026”
- Cloud revenue is expected to grow 30% year-over-year driven by AI demand and GPU computing adoption
- Customer management revenue projected to rise 10% supported by higher traffic and cross-selling
- Quick commerce losses expected to peak in the September quarter with improvement by December
- 19 of 21 analysts rate Alibaba as a Strong Buy with consensus price target of $192
Jefferies analyst Thomas Chong has reaffirmed his Buy rating on Alibaba stock with a price target of $230. The target represents about 32% upside from current levels.
Chong ranks number 307 among more than 10,000 analysts on TipRanks. He has a 59% success rate with an average return of 16.50% per rating over one year.
The analyst called Alibaba one of Jefferies’ “maximum bullish” ideas for 2026. His confidence stems from growth in AI, cloud services, and digital consumption.
Alibaba Cloud continues to expand quickly, driven by what Chong calls the company’s “full-stack AI infrastructure.” He expects cloud revenue to climb about 30% year-over-year.
The growth comes from wider use of GPU chips, more AI training needs, and higher demand for custom data models. Industries across the board are switching to GPU computing.
Jefferies expects total revenue growth of 2% in the September-ended quarter. This aligns with consensus estimates and the firm’s previous projections.
E-Commerce and Quick Commerce Performance
On the e-commerce front, Chong sees stronger connections between core commerce and Quick Commerce. Quick commerce involves ultrafast delivery of groceries and daily essentials through Taobao and Ele.me platforms.
Customer management revenue should grow about 10% year-over-year. This growth comes from higher traffic, cross-selling opportunities, and increased purchase frequency.
The quick commerce expansion could be viewed as a defensive strategy. Alibaba faces mounting pressure from competitors like Meituan in the domestic market.
Chong said quick commerce losses should peak in the September quarter. Better results are expected by December as the business matures.
Jefferies expects Alibaba’s International Digital Commerce Group to post a quarterly loss of 36 million yuan. This would be lower than the consensus estimate of 41 million yuan.
The international segment includes AliExpress and Lazada. AliExpress competes with Temu and Amazon while Lazada faces Shopee and TikTok Shop in Southeast Asia.
AI Investments and Platform Development
Alibaba continues to invest in AI-based applications including Amap, DingTalk, and Quark. These investments could lead to higher short-term losses.
The company recently launched Qwen3-Max, described as its “largest and most capable” AI model. Alibaba has pledged to build new data centers overseas and increase AI spending.
Citi Research analysts expect this increased spending to show up in adjusted EBITDA. As Alibaba ramps up to meet AI cloud demand, costs will rise.
Chong believes these projects are essential for strengthening Alibaba’s products. They support long-term growth in the company’s digital ecosystem.
U.S.-listed shares fell 4% to $173.89 on Thursday. Despite the decline, shares have gained 77% over the past year.
The stock benefits from sustained enthusiasm for artificial intelligence. The technology push has helped offset concerns about competition in traditional e-commerce.
Analysts remain bullish on Alibaba’s trajectory. Of 56 analysts tracked by FactSet, 51 rate the stock as Buy or equivalent.
Four analysts rate it at Hold and one at Sell. On TipRanks, 19 analysts give Buy ratings while two give Hold ratings.
The average Alibaba price target stands at $191.99. This implies about 10.54% upside potential from current levels.
Citi rates Alibaba at Buy with a $218 price target, up from $217. Jefferies’ $230 target remains the most optimistic among major firms covering the stock.
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