Alibaba Stock: A Strong Buy Amidst Recent Weakness and Favorable Analyst Sentiment

Alibaba's stock has fallen 27% from its 2025 highs, but still up 27% for the year. The company's recent financial performance has underwhelmed, and it faces intense competition in China. However, it remains a Wall Street favorite with a "Strong Buy" rating from 19 analysts and a mean target price of $163.12, nearly 50% higher than current price levels. Alibaba is looking to expand its target market and drive growth through new avenues.

Alibaba Group Holding Limited (NYSE:BABA) has experienced a mixed bag of performance and analyst ratings in recent quarters. The company's stock has fallen 27% from its 2025 highs, yet it has still managed to rise 27% for the year. This fluctuation in stock performance comes amidst underwhelming financial results and intense competition in China.

Institutional Investor Activity

Several institutional investors have made notable changes to their positions in Alibaba Group. Hexagon Capital Partners LLC, for instance, reduced its holdings by 44.7% in the first quarter, selling 5,887 shares and leaving it with 7,281 shares worth $963,000 [1]. On the other hand, ORG Partners LLC raised its position by 950.0%, purchasing an additional 285 shares and owning 315 shares valued at $42,000 [1].

Analyst Ratings and Price Targets

Despite the mixed performance, Alibaba remains a Wall Street favorite. Nineteen analysts have assigned a "Strong Buy" rating to the stock, with a mean target price of $163.12, nearly 50% higher than the current price levels [1]. However, Arete Research recently downgraded Alibaba from a "strong-buy" rating to a "hold" rating [1]. Mizuho and Citigroup have also adjusted their target prices, with Mizuho reducing its target from $170.00 to $160.00 and Citigroup lowering it from $170.00 to $169.00 [1].

Financial Performance and Dividend

Alibaba's stock performance has been underwhelming, with a 1-year low of $72.95 and a 1-year high of $148.43. The company's market capitalization stands at $259.31 billion, with a P/E ratio of 14.59 and a P/E/G ratio of 0.47. Alibaba's dividend payout ratio is currently 13.83%, with a recent dividend cut announced to be paid on July 10th [1].

Conclusion

Alibaba Group faces challenges in maintaining its growth momentum amidst stiff competition in China. However, its strong analyst ratings and potential for expansion into new markets present opportunities for investors. The company's ability to navigate these challenges and capitalize on new growth avenues will be crucial in determining its future performance.

References

[1] https://www.marketbeat.com/instant-alerts/filing-hexagon-capital-partners-llc-lowers-holdings-in-alibaba-group-holding-limited-nysebaba-2025-07-06/