Alibaba's Price Target Raised to $165.8 Amid Positive Outlook and Optimistic Earnings Guidance

CCB International has upgraded Alibaba's (BABA) stock rating to "outperform" with a raised price target of $165.8. The company's first-quarter performance exceeded expectations, and management is optimistic about accelerating cloud business, maintaining core e-commerce revenue growth, and improving unit economics. CCB International raised Alibaba's revenue forecast for FY26-28 but adjusted profit expectations down for FY26 and FY27. Investments in AI cloud and instant retail remain key drivers for growth.

Title: Alibaba's (BABA) Stock Upgraded to "Outperform" by CCB International

CCB International has upgraded Alibaba's (BABA) stock rating to "outperform" with a raised price target of $165.8. The upgrade reflects promising growth prospects in Alibaba's AI and cloud businesses, as well as robust execution in its core segments. The company's first-quarter performance exceeded expectations, with management expressing optimism about accelerating cloud business, maintaining core e-commerce revenue growth, and improving unit economics [1].

Alibaba's revenue for the first fiscal quarter of 2026 exceeded analyst estimates by 1.1%, reaching $34.57 billion. While adjusted earnings per share (EPS) fell short of expectations, the company's strategic focus on consumption and AI showed strong traction. Revenue from the Cloud Intelligence Group surged 26% year-over-year, driven by AI computing and storage demand [2]. The company's AI-related product revenue delivered triple-digit growth for the eighth consecutive quarter, signaling strong scalability potential [3].

CCB International raised Alibaba's revenue forecast for fiscal years 2026 through 2028 by 1-4% but adjusted profit expectations down for 2026 and 2027. The company's investments in AI cloud and instant retail remain key drivers for growth, despite potential short-term profit pressures [1].

Alibaba's stock price surged following the release of its Q1 FY2026 earnings, highlighting solid revenue growth and strength in its core cloud and commerce units. The stock closed up 19% in Hong Kong trading, reflecting investors' focus on Alibaba's AI potential and cloud growth [3]. Multiple analysts raised their price targets, with JPMorgan setting the highest at $170 from $140 following the earnings beat [3].

Alibaba's strategic restructuring, including the consolidation of Taobao and Tmall into a unified e-commerce unit, aims to improve synergies and strengthen focus on strategic pillars. The company's AI chip development, capable of handling a broader range of tasks than previous processors, adds to its momentum in the competitive AI sector [3].

Investors should closely monitor Alibaba's progress in AI cloud and instant retail investments, as well as its ability to maintain core e-commerce revenue growth and improve unit economics. The company's long-term strategic positioning, driven by technology investments and operational efficiency, could significantly impact its future growth prospects.

References:
[1] https://www.gurufocus.com/news/3088920/alibabas-baba-target-price-raised-amid-ai-and-cloud-growth-prospects
[2] https://coincentral.com/alibaba-baba-stock-solid-revenue-beat-cloud-momentum-and-consumer-surge-in-q1-fy26/
[3] https://moneycheck.com/alibaba-group-baba-stock-analysts-turn-bullish-on-ai-and-cloud-growth-after-earnings-beat/