These two Chinese artificial intelligence (AI) stocks have massive potential.Once a neglected group, Chinese tech companies have recently captured the attention of investors thanks to a series of positive developments, such as the huge government stimulus and the rise of artificial intelligence (AI) services like DeepSeek.Investors looking for companies they can invest in to benefit from the growth of AI in China have generally focused on leading tech companies like Alibaba (BABA 5.72%) and Baidu (BIDU 1.82 ...

When I think of the Chinese market, I think of legendary investor George Soros’s quote:“When I see a bubble forming, I rush in to buy, adding fuel to the fire."Another one that comes to mind is Stan Druckenmillers liquidity quote:“Earnings don't move the overall market; it's the Federal Reserve Board... focus on the central banks, and focus on the movement of liquidity... most people in the market are looking for earnings and conventional measures. It's liquidity that moves markets.”This chart of China’s mo ...

Alibaba Group (BABA) spread cheer among investors following its third-quarter fiscal 2025 results. The Chinese e-commerce giant recorded its fastest pace of revenue growth in more than a year. Though it missed estimates on the earnings front, revenues came ahead of expectations. Shares of BABA jumped to a three-year high following the results and closed 8.1% higher yesterday. Investors seeking to tap the growth should invest in ETFs with the largest allocation to this Chinese e-commerce giant. These include ...

Alibaba stock is up 66% this year already.In this video, I will talk about Alibaba (BABA 5.79%) and its recent earnings report. Watch the short video to learn more, consider subscribing, and click the special offer link below.*Stock prices used were from the trading day of Feb. 19, 2025. The video was published on Feb. 20, 2025. ...

Alibaba Group Holding Limited (NYSE: BABA ) saw solid growth in the vital e-Commerce and Cloud segments in the December quarter , highlighting that the Chinese company is still very much a growth play. Alibaba submitted better-than-expected earningsAnalyst’s Disclosure: I/we have a beneficial long position in the shares of BABA, PDD either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than ...

Alibaba (BABA) shares opened 10% higher in Hong Kong on Feb. 21 to reach their highest level in more than three years, after the company reported third-quarter fiscal 2025 revenues of $38.3 million, which beat the Zacks Consensus Estimate by 0.51%. The company said it plans to invest more in e-commerce and AI.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.In domestic currency, revenues of RMB 280.1 billion increased 8% year over year.The top-line increase was driven by improved monet ...

Group 1 - Alibaba shares surged in Hong Kong by as much as 11%, closing 9.18% higher, following strong quarterly results driven by growth in cloud intelligence and e-commerce segments [1] - Nomura expects the outlook for Alibaba's e-commerce business to remain strong in the first half of calendar year 2025, supported by continued trade-in subsidies [1] - China's plan to allocate 300 billion yuan ($41.5 billion) in ultra-long special government bonds aims to enhance trade-in and equipment upgrade policies to stimulate consumption [2] Group 2 - Domestic e-commerce growth in China is recovering towards sustainable growth and profitability, positively impacting the broader technology sector [2] - Chinese tech stocks have been performing well, particularly after AI startup DeepSeek emerged, challenging the U.S.-led AI ecosystem with claims of superior performance and lower costs [3]

Investment Rating - The report maintains a "BUY" rating for Alibaba with a target price of US$157.7, up from the previous target of US$132.2, indicating a potential upside of 25.4% from the current price of US$125.79 [2][27]. Core Insights - Alibaba's total revenue for 3QFY25 was RMB280.2 billion, reflecting a year-over-year growth of 7.6%, which was 1% above Bloomberg consensus estimates. Adjusted EBITA and non-GAAP net income for the quarter were RMB54.9 billion and RMB51.3 billion, respectively, showing increases of 3.8% and 6.5% year-over-year, both exceeding consensus expectations [1][5]. - The growth outlook for Alibaba's EBITA in FY26E is becoming more positive, driven by factors such as increased merchant adoption of Quanzhantui, quicker-than-expected loss reduction from Alibaba International Digital Commerce Group (AIDC), and accelerated cloud revenue growth due to rising AI inference demand across various industries [1][24]. Summary by Relevant Sections Financial Performance - Revenue for FY25E is projected at RMB1,001.6 billion, with a year-over-year growth of 6.4%. Non-GAAP net profit is expected to reach RMB159.9 billion, reflecting a growth of 1.0% [6][25]. - The adjusted EBITA margin for the consolidated group is anticipated to be 19.6% for 3QFY25, which is 0.5 percentage points ahead of consensus [23]. Business Segments - **Taobao and Tmall Group**: Revenue was RMB136.1 billion in 3QFY25, up 5.4% YoY, with customer management revenue (CMR) contributing RMB100.8 billion, a 9.4% increase YoY [8][9]. - **Cloud Intelligence Group (CIG)**: Revenue reached RMB31.7 billion, up 13% YoY, driven by strong demand for AI-related products. The adjusted EBITA margin was 9.9%, indicating improved operational efficiency [13][24]. - **Alibaba International Digital Commerce Group (AIDC)**: Revenue grew by 32% YoY to RMB37.8 billion, although adjusted EBITA loss widened to RMB5.0 billion due to increased investments [12][24]. Forecast Revisions - The FY25-27E revenue forecast has been increased by 1-3%, and non-GAAP net profit estimates have been raised by 5-9%, primarily due to better-than-expected performance in CMR and cloud revenue [24][25]. Valuation - The new SOTP-based target price of US$157.7 translates into a price-to-earnings ratio of 17.0x for FY25E and 14.9x for FY26E [27][30].

Investment Rating - The report maintains a "Buy" rating for Alibaba (BABA US) with a target price raised to $157.7 from $132.2, reflecting a 25.4% upside potential from the current price of $125.79 [1][5][26]. Core Insights - Alibaba's total revenue for Q3 FY25 reached RMB 280.2 billion, a year-on-year increase of 7.6%, surpassing Bloomberg's expectation of 7.5%. Adjusted EBITDA and non-GAAP net profit were RMB 549 billion and RMB 513 billion, respectively, showing growth of 3.8% and 6.5%, also exceeding expectations [1][4]. - The growth in revenue is attributed to better-than-expected performance from the Taobao Tmall Group (T&T) and Cloud Intelligence Group (CIG), with T&T's revenue growing by 5.4% and CIG's revenue increasing by 13% [2][3][12]. - The report highlights improved profitability prospects for Alibaba, driven by higher acceptance of full-link tracking by merchants, faster-than-expected reduction in losses for the Alibaba International Digital Commerce Group (AIDC), and increased demand for AI inference driving cloud revenue growth [1][4]. Summary by Sections Financial Performance - T&T Group generated RMB 1,361 billion in revenue, with CMR contributing RMB 1,008 billion, reflecting a 9.4% year-on-year growth, driven by increased online GMV and improved commission rates [2][12]. - CIG's revenue reached RMB 317 billion, a 13% increase, benefiting from unexpected growth in GPU cloud computing demand [3][15]. - AIDC's revenue was RMB 37.8 billion, up 32% year-on-year, with management expecting profitability in Q1 FY26, earlier than previously anticipated [3][14]. Revenue Forecast Adjustments - Revenue forecasts for FY25-27 have been raised by 1-3%, and non-GAAP net profit estimates have been increased by 5-9%, primarily due to better-than-expected growth in CMR and cloud computing revenues [4][23]. Valuation and Target Price - The new target price of $157.7 corresponds to a projected P/E ratio of 15x for FY26, reflecting a valuation adjustment based on improved performance expectations across various segments [1][26]. - The valuation breakdown includes $80.7 for T&T Group, $11.7 for AIDC, and $33.2 for CIG, among others, indicating a comprehensive assessment of Alibaba's diverse business units [26][27].

Core Insights - Alibaba Group reported a slight performance boost in Q4 2024, with non-GAAP EPS at $2.93, exceeding the projected $2.66, and revenue of $38.381 billion, surpassing the forecast of $38.102 billion [2][3] Financial Performance - Non-GAAP EPS increased from $2.37 in Q4 2023 to $2.93 in Q4 2024 [3] - Revenue rose from $37.117 billion in Q4 2023 to $38.381 billion in Q4 2024 [3] - Non-GAAP net income for Q4 2024 was $6.996 billion, up from $6.641 billion in Q4 2023 [3] - Free cash flow decreased to $5.346 billion from $8.000 billion in Q4 2023 [3][8] Business Segments Performance - China Commerce Sector revenue increased by 5% to RMB129,516 million ($17.743 billion) [6] - Cloud Intelligence Group revenue grew by 13% year-over-year to RMB31,742 million ($4.349 billion) [6] - International Digital Commerce Group saw a 32% revenue increase to RMB37,756 million ($5.173 billion) [6] - Cainiao's revenue slightly decreased by 1% to RMB28,241 million ($3.869 billion) [7] - Local consumer services revenue grew by 12%, driven by Amap and Ele.me [7] - Digital media segment revenue increased by 8% to RMB5,438 million ($745 million) [7] Strategic Focus - Alibaba is shifting towards international expansion and cloud computing to meet increasing market demand for technology-led services [5] - Management is optimistic about AI-led solutions as a growth driver and aims to enhance its commerce ecosystem while expanding internationally [9]