StoneX reiterates Alibaba stock buy rating on cloud strength

Investing.com reports that StoneX has reaffirmed its Buy rating and $220.00 price target for Alibaba Group Holding Ltd (NYSE:BABA) shares, citing the company's strong cloud position and favorable growth outlook. Since the first-quarter fiscal 2027, Alibaba's shares have been trading sideways amid renewed China macro concerns and broader market noise.

Currently trading at $110.78, the stock has declined 24% year-to-date, but analysts believe it is still undervalued based on Fair Value estimates. With a market cap of $275 billion and a P/E ratio of 25.5, the stock trades below its intrinsic value. StoneX highlights two key factors driving potential earnings upside: continued cloud outperformance and faster-than-expected margin expansion, supported by stabilizing core e-commerce trends and reduced quick commerce losses.

The firm's channel checks indicate robust demand for GPU cloud and AI services, suggesting sustained high cloud growth through fiscal year 2027 and into 2028. Despite a muted consumption backdrop, StoneX maintains a positive view on the stock.