Alibaba Group (BABA) Soars 2.63% in Two-Day Rally Amid Analyst Revisions, Blockchain Investments

Alibaba Group (BABA) surged 2.63% on Tuesday, marking its second consecutive day of gains, with a two-day rally pushing the stock up 15.87%. The share price hit its highest level since September 2025, with an intraday increase of 2.84%.

Recent analyst revisions and valuation pressures highlight the stock’s mixed outlook. Earnings estimates for the current quarter remain subdued, projecting a 27% year-over-year decline, while next year’s expectations show a potential 23.7% rebound. However, the lack of recent upward revisions has contributed to a Zacks Rank of #5 (Strong Sell), reflecting skepticism about near-term execution and market share retention. Despite outperforming broader indices in the past 30 days, Alibaba’s premium valuation metrics suggest limited upside unless profitability improves.

Strategic moves, including a $44 million investment in Ethereum by founder Jack Ma’s firm, signal a pivot toward blockchain and decentralized technologies. This aligns with long-term digital transformation goals but remains speculative in the short term. Meanwhile, competitive dynamics in AI and cloud computing intensify, with rivals like Tencent and Baidu accelerating investments. Alibaba’s focus on growth over immediate value creation underscores a race to establish AI leadership, though tangible revenue impacts may take years to materialize.

Market sentiment remains cautious amid macroeconomic headwinds. Rising interest rates and regulatory uncertainties in China’s tech sector add volatility, complicating Alibaba’s path to consistent earnings. While recent revenue stability has provided some support, translating this into profit remains inconsistent. Analysts emphasize that sustained operational improvements and clearer AI monetization are critical to restoring investor confidence and justifying the stock’s current valuation.