Despite being overlooked amid market highs, Alibaba (NYSE) is setting the stage for a dramatic resurgence. The Chinese e-commerce titan’s Q4-2024 results showcased a remarkable 7% year-over-year revenue surge, hinting at a powerful FY2025. The company’s core platforms, international ventures, and cutting-edge AI developments are driving this resurgence, defying sceptics.
In an impressive display of financial prowess, Alibaba’s adjusted EBITA rocketed 12% to $22.9 billion, while aggressive share buybacks and dividends signal a robust commitment to shareholders.
Is BABA Stock a Buy, According to Analysts?
Most Wall Street analysts remain bullish on Alibaba, which isn’t surprising, given its depressed valuation. The stock maintains a Strong Buy consensus rating based on 14 Buys and three Holds. At $103.70, the average BABA stock price target has recently widened from the current stock price, implying substantial upside potential of 39.2%.
Alibaba’s stock has consistently underperformed over the years, including during the recent uptrend of the broader market. That said, recent developments suggest a potential U-turn. With a return to growth in FY2024 and promising indicators for FY2025, Alibaba’s investment case seems increasingly promising. Blended with a recent focus on capital returns, including substantial share buybacks and a growing dividend, Alibaba may be in a position to start attracting the bulls back.
Regardless, at its current valuation, the potential rewards appear to outweigh the risks, even considering the inherent risks associated with a company like Alibaba.
