Upside case
Bull case
$4722+3470.8%
BABA would need investors to value it at roughly 138x earnings — about 134x more generous than today's 4x forward P/E. That requires meaningful multiple expansion on top of continued earnings growth.
Analysis OverviewBuyUpdated May 1, 2026
Alibaba Group Holding Limited (BABA) Stock Analysis
Wall Street verdict, consensus price target, and analyst rating breakdown — everything needed to frame the risk/reward at today's price.
Analyst consensus
Buy
Covering
59
analysts
51 bullish · 1 bearish · 59 covering BABA
Strong Buy
0
Buy
51
Hold
7
Sell
1
Strong Sell
0
Consensus Target
$194
+46.9% vs today
Scenario Range
$649 – $4722
Model bear to bull value window
Coverage
59
Published analyst ratings
Valuation Context
3.9x
Forward P/E · Market cap $319.3B
BABA price targets
Three scenarios for where BABA stock could go
Current
~$132
Confidence
57 / 100
Updated
May 1, 2026
Where we are now
Current · $132
Bear
$649
Base
$939
Bull
$4722
Market caseClosest to today
Base case
$939+610.1%
At 27x on FY1 earnings, the base case reflects a reasonable but not stretched valuation. It prices in continued growth without assuming an exceptional setup.
Stress case
Bear case
$649+390.5%
The bear case assumes sentiment or fundamentals disappoint enough to push BABA down roughly 391% from the current price.
Not financial advice. Model confidence reflects internal scenario assumptions, not a guarantee of returns. Past performance does not predict future results.
Alibaba Group Holding Limited
BABA · NYSEConsumer CyclicalSpecialty RetailMarch year-end
Alibaba is a Chinese e-commerce and technology conglomerate that operates digital marketplaces connecting buyers and sellers. It generates revenue primarily from its core commerce segments — China Commerce (~65%) and International Commerce (~10%) — along with cloud services (~10%) and logistics through Cainiao. Its key competitive advantage is its massive ecosystem network effect, where its platforms like Taobao and Tmall create a self-reinforcing cycle of merchants and consumers that's difficult for competitors to replicate.
Market Cap
$319.3B
Revenue TTM
$1.01T
Net Income TTM
$123.4B
Net Margin
12.2%
BABA Revenue and Earnings Performance
Quarterly beat-or-miss track record against analyst estimates, plus forward revenue and EPS outlook for the next two fiscal years.
EPS Beat Rate
67%Exceptional
12 quarters tracked
Revenue Beat Rate
58%Exceptional
vs consensus estimates
Avg EPS Surprise
+3.1%
above Street consensus
Beat / Miss Record
BeatMissLeft = EPS · Right = Revenue
Q2 2025
Q3 2025
Q4 2025
Q1 2026
Last 4 Quarters
EPS beats: 1 of 4Q2 2025
EPS
$1.73/$1.48
Revenue
$32.5B/$36.1B
Q3 2025
EPS
$2.06/$2.13
Revenue
$34.5B/$34.3B
Q4 2025
EPS
$0.61/$0.66
Revenue
$34.8B/$41.9B
Q1 2026
EPS
$1.01/$1.65
Revenue
$40.7B/$41.4B
| Quarter | EPS (Actual / Est) | EPS Surprise | Revenue (Actual / Est) | Rev Surprise |
|---|---|---|---|---|
| Q2 2025 | $1.73/$1.48 | +16.9% | $32.5B/$36.1B | -10.1% |
| Q3 2025 | $2.06/$2.13 | -3.3% | $34.5B/$34.3B | +0.8% |
| Q4 2025 | $0.61/$0.66 | -7.6% | $34.8B/$41.9B | -16.8% |
| Q1 2026 | $1.01/$1.65 | -38.8% | $40.7B/$41.4B | -1.5% |
FY1–FY2 Estimates
Revenue Outlook
FY1
$1.05T
+3.6% YoY
FY2
$1.16T
+10.3% YoY
EPS Outlook
FY1
$42.70
-17.1% YoY
FY2
$55.75
+30.6% YoY
Trailing FCF (TTM)$2.6B
FCF Margin: 0.3%
Next Earnings
May 13, 2026
Expected EPS
$0.89
Expected Revenue
$35.8B
BABA beat EPS estimates in 1 of 4 tracked quarters. Mixed delivery makes the upcoming report a key data point for re-rating.
BABA Revenue Breakdown by Segment
Product and geographic revenue mix from the latest annual disclosure, with year-over-year growth by segment.
Latest disclosure
FY 2025
Total disclosed revenue $996.3B
Product Mix
Latest annual revenue by segment or product family
Customer Management Services
42.6%
+9.9% YoY
Tap, hover, or focus a slice to inspect segment detail.
Geographic Mix
Latest annual revenue by reported region
Segment breakdown not available for this company.
Customer Management Services is the largest disclosed segment at 42.6% of FY 2025 revenue, up 9.9% YoY.
BABA Valuation Snapshot
Current multiples compared to the S&P 500, the company's sector, and its own five-year average.
Relative Value Signal
Significantly Undervalued
Fair value est. $795 — implies +504.9% from today's price.
Upside to Fair Value
504.9%
potential upside
Deep DiscountFair ValueVery Expensive
vs S&P 500 Trailing P/E
BABA
16.8x
vs
S&P 500
25.1x
33% discount
vs Consumer Cyclical Trailing P/E
BABA
16.8x
vs
Consumer Cyclical
19.3x
13% discount
vs BABA 5Y Avg P/E
Today
16.8x
vs
5Y Average
3.5x
+382% premium
Forward PE
3.9x
S&P 500
19.1x
-80%
Consumer Cyclical
15.1x
-74%
5Y Avg
—
—
Trailing PE
16.8x
S&P 500
25.1x
-33%
Consumer Cyclical
19.3x
-13%
5Y Avg
3.5x
+382%
PEG Ratio
—
S&P 500
1.72x
—
Consumer Cyclical
0.91x
—
5Y Avg
—
—
EV/EBITDA
12.8x
S&P 500
15.2x
-16%
Consumer Cyclical
11.3x
+13%
5Y Avg
2.0x
+545%
Price/FCF
27.8x
S&P 500
21.1x
+32%
Consumer Cyclical
14.6x
+91%
5Y Avg
2.7x
+914%
Price/Sales
2.2x
S&P 500
3.1x
-30%
Consumer Cyclical
0.7x
+205%
5Y Avg
0.4x
+435%
Dividend Yield
1.35%
S&P 500
1.87%
-28%
Consumer Cyclical
2.23%
-39%
5Y Avg
9.50%
-86%
| Metric | BABA | S&P 500 | Consumer Cyclical | 5Y Avg BABA |
|---|---|---|---|---|
| Forward PE | 3.9x | 19.1x-80% | 15.1x-74% | — |
| Trailing PE | 16.8x | 25.1x-33% | 19.3x-13% | 3.5x+382% |
| PEG Ratio | — | 1.72x | 0.91x | — |
| EV/EBITDA | 12.8x | 15.2x-16% | 11.3x+13% | 2.0x+545% |
| Price/FCF | 27.8x | 21.1x+32% | 14.6x+91% | 2.7x+914% |
| Price/Sales | 2.2x | 3.1x-30% | 0.7x+205% | 0.4x+435% |
| Dividend Yield | 1.35% | 1.87% | 2.23% | 9.50% |
BABA trades above S&P 500 benchmarks on 1 of 5 measured multiples — appears modestly priced relative to the S&P 500 on most measures.
Forward P/E and PEG reflect analyst consensus estimates. Historical averages use trailing ratios where forward data is unavailable.S&P 500 and sector benchmarks both use trailing median P/E — similar readings indicate the broader index and sector are priced alike.
Open valuation toolBABA Financial Health
Verdict
Adequate
BABA returns 5.4% of market cap to shareholders annually.
Cash Engine
Revenue, margins, and cash generation
Revenue (TTM)
Trailing-twelve-month sales base
$1.01T
Revenue Growth
TTM vs prior year
+5.2%
Gross Margin
Gross profit as a share of revenue
41.2%
Operating Margin
Operating income divided by revenue
10.9%
Net Margin
Net income divided by revenue
12.2%
EPS (TTM)
Diluted earnings per share, trailing twelve months
$51.48
Free Cash Flow (TTM)
Cash generation after capex
$2.6B
FCF Margin
FCF as share of revenue — the primary cash quality signal
0.3%
Capital Quality
ROIC, leverage, and debt serviceability
ROIC
Return on invested capital — primary competitive quality signal
9.6%
ROA
Return on assets, trailing twelve months
6.7%
Cash & Equivalents
Liquid assets on the balance sheet
$181.7B
Net Debt
Total debt minus cash
$66.8B
Debt Serviceability
Net debt as a multiple of annual free cash flow
25.4× FCF
~25.4 years to full repayment at current FCF run-rate
ROE
Return on equity, trailing twelve months
11.2%
Shareholder Returns
How capital is returned to owners
Total shareholder yield
5.4%
Dividend
1.3%
Buyback
4.0%
Share Repurchases
Trailing buyback outflow — dollar magnitude of capital returned
$87.4B
Dividend / Share
Annualized trailing dividend per share
$12.14
Payout Ratio
Share of earnings distributed as dividends
22.5%
Shares Outstanding
Declining as buybacks retire shares
2.4B
All figures from the trailing twelve months. ROIC uses invested capital (equity + net debt).
Open full ratios pageBABA Stock Risk Factors
Key factors that could pressure the stock price, compress the multiple, or weigh on future results.
AI analysis · updated April 11, 2026
High Risk
Regulatory & Geopolitical Risks
Alibaba faces ongoing Chinese regulatory scrutiny; potential crackdowns on tech, data, and AI could derail momentum. US‑China tensions, possible sanctions, and inclusion on a Pentagon list in early 2026 add headline risk, potentially increasing legal expenses and compliance costs.
High Risk
Profitability Pressures
Heavy investments in AI, cloud, and quick commerce are eroding margins. Q3 FY2026 EBITDA fell 57% due to these costs, and if margins do not recover, the core commerce business may struggle to fund growth engines.
Medium
Intense Competition
Alibaba competes with Pinduoduo, Douyin, and JD.com in core e‑commerce, and with Meituan and JD.com in quick commerce, requiring heavy subsidies and logistics spend. In cloud and AI, domestic rivals Huawei and Tencent add pressure, potentially eroding market share.
Medium
Heavy Investment Spending
Alibaba pledges billions of dollars over the next three years to AI infrastructure. Long payback windows for AI models and data centers weigh on short‑term profitability, while quick commerce expansion also demands significant capital outlays.
Medium
Macroeconomic Headwinds
China’s uneven consumer spending recovery, property sector weakness, youth unemployment, and deflationary pressures dampen domestic demand. Alibaba’s e‑commerce volume is directly exposed to these headwinds, potentially slowing growth.
Lower
Valuation & Investor Sentiment
Analyst upside expectations driven by AI and cloud may be inflated. If growth or margins miss forecasts, multiples could contract sharply, and volatile sentiment toward Chinese tech can shift the stock independent of fundamentals.
Lower
Governance Structure
The Alibaba Partnership can nominate a majority of the board, limiting influence of other shareholders. This concentration may reduce transparency and shareholder alignment.
Lower
Potential Dilution
If Alibaba must dilute shares to raise capital for its AI push, the share price could be negatively impacted, reducing existing shareholders’ ownership stake.
These are risk mechanisms, not predictions. The key question is which would force a cut to earnings estimates or a lower multiple than the market currently prices in.
Why BABA Stock Could Outperform
Structural drivers behind the upside case and why the stock could outperform over the next 12 months.
AI analysis · updated April 11, 2026
Undervalued Core E‑Commerce Cash Flow
Alibaba’s Taobao and Tmall generate strong cash flow and profits, with analysts suggesting this segment alone justifies the current market cap. Investors are effectively buying the company’s other assets—cloud, fintech, and international commerce—at a significant discount.
AI‑Driven Cloud Expansion
The cloud division is accelerating growth as demand for AI workloads rises. Alibaba’s own AI model, Qwen, underpins this momentum, positioning Alibaba Cloud for substantial revenue expansion.
Strategic AI Infrastructure Investment
Alibaba has committed over 50 billion yuan (≈ $53 billion) over the next three years to build AI infrastructure. This pivot aims to make Alibaba a comprehensive AI services and infrastructure provider.
Ecosystem Synergies Across Platforms
Alibaba’s ecosystem—e‑commerce, logistics, and cloud—enables integrated AI adoption, unlocking new efficiencies and revenue streams across its diverse businesses.
Robust Financial Position
Despite recent capital expenditures, Alibaba maintains strong net cash reserves and significant free cash flow from its core e‑commerce operations, providing a solid foundation for future growth.
A real bull case compounds — each driver matters most when it strengthens margins, supports capital returns, and keeps the company above the market's minimum growth bar simultaneously.
BABA Stock Price Performance
52-week range context and price returns across multiple time horizons. Dividend contribution is shown separately in the Capital Return section.
Current Price
$132.23
52W Range Position
32%
52-Week Range
Current price plotted between the 52-week low and high.
52-Week Low
$103.71
+27.5% from the low
52-Week High
$192.67
-31.4% from the high
1 Month
+8.09%
3 Month
-16.18%
YTD
-15.1%
1 Year
+4.5%
3Y CAGR
+16.7%
5Y CAGR
-10.2%
10Y CAGR
+5.3%
Range context matters because valuation compression and earnings misses rarely hit from the same starting point. A stock already far below its high can still fall, but it is no longer carrying the same embedded optimism as one pressing a fresh peak.
BABA vs Peers
Valuation, growth, and margin comparison against the closest publicly traded peers for this company.
Peer Set
Accurate peer set
Forward PE
3.9x
vs 2.3x median
+66% above peer median
Revenue Growth
+3.6%
vs +10.0% median
-64% below peer median
Net Margin
12.2%
vs 6.9% median
+77% above peer median
| Company | Mkt Cap | Fwd PE | Rev Grw | Margin | Rating | Upside |
|---|---|---|---|---|---|---|
BAB BABA Alibaba Group Holding Limited | $319.3B | 3.9x | +3.6% | 12.2% | Buy | +46.9% |
JD JD JD.com, Inc. | $45.6B | 1.4x | +7.6% | 2.5% | Buy | +10.7% |
PDD PDD PDD Holdings Inc. | $143.1B | 1.2x | +21.3% | 24.4% | Buy | +46.8% |
AMZ AMZN Amazon.com, Inc. | $2.94T | 35.1x | +10.0% | 12.2% | Buy | +12.2% |
BID BIDU Baidu, Inc. | $44.2B | 2.3x | +1.5% | 6.9% | Buy | +22.5% |
SE SE Sea Limited | $51.1B | 23.9x | +31.0% | 6.8% | Buy | +74.8% |
This peer comparison reflects companies with similar business models, product lines, or market positioning, supplemented by industry grouping when direct matches are limited.
BABA Dividend and Capital Return
BABA returns capital mainly through $87.4B/year in buybacks (4.0% buyback yield), with a modest 1.35% dividend — combining for 5.4% total shareholder yield.
Dividend SustainableFCF Stretched
Total Shareholder Yield
5.4%
Dividend + buyback return per year
Buyback Yield
4.0%
Dividend Yield
1.35%
Payout Ratio
22.5%
How BABA Splits Its Return
Div 1.35%
Buyback 4.0%
Dividend 1.35%Buybacks 4.0%
Dividend Profile
Yield, cadence, and growth quality
Dividend / Share
Trailing annualized cash dividend
$12.14
Growth Streak
Consecutive years of dividend increases
2Y
3Y Div CAGR
—
5Y Div CAGR
—
Ex-Dividend Date
—
Payment Cadence
Annual
1 payments over the last 12 months
Buyback Engine
How much per-share support comes from repurchases
Repurchases (TTM)
Cash used for buybacks in the latest trailing period
$87.4B
Estimated Shares Retired
661M
Approx. Share Reduction
27.4%
Shares Outstanding
Current diluted share count from the screening snapshot
2.4B
At 27.4%/year, buybacks mechanically lift EPS even with flat earnings — each remaining share represents a slightly larger piece of the company.
| Year | Div / Share | YoY Grw | BB Yield | Total Yield |
|---|---|---|---|---|
| 2025 | $2.00 | +20.5% | 27.4% | 36.5% |
| 2024 | $1.66 | +69.4% | 48.6% | 58.4% |
| 2023 | $0.98 | — | 27.7% | 27.7% |
FAQ
7 questionsBABA Investor Questions
Common questions answered from live analyst data and company financials.
01Is Alibaba Group Holding Limited (BABA) stock a buy or sell in 2026?
Alibaba Group Holding Limited (BABA) is rated Buy by Wall Street analysts as of 2026. Of 59 analysts covering the stock, 51 rate it Buy or Strong Buy, 7 rate it Hold, and 1 rate it Sell or Strong Sell. The consensus 12-month price target is $194, implying +46.9% from the current price of $132. The bear case scenario is $649 and the bull case is $4722.
02What is the BABA stock price target for 2026?
The Wall Street consensus price target for BABA is $194 based on 59 analyst estimates. The high-end target is $225 (+70.2% from today), and the low-end target is $140 (+5.9%). The base case model target is $939.
03Is Alibaba Group Holding Limited (BABA) stock overvalued in 2026?
BABA trades at 3.9x times forward earnings. The stock currently trades at a discount to the broader market. Based on current multiples versus the peer group, the relative model signals significantly undervalued. Whether the stock is over or undervalued ultimately depends on whether consensus earnings estimates are achievable.
04What are the main risks for Alibaba Group Holding Limited (BABA) stock in 2026?
The primary risks for BABA in 2026 are: (1) Regulatory & Geopolitical Risks — Alibaba faces ongoing Chinese regulatory scrutiny; potential crackdowns on tech, data, and AI could derail momentum. (2) Profitability Pressures — Heavy investments in AI, cloud, and quick commerce are eroding margins. (3) Intense Competition — Alibaba competes with Pinduoduo, Douyin, and JD. Each factor has the potential to pressure earnings or compress the stock's valuation multiple.
05What is Alibaba Group Holding Limited's revenue and earnings forecast?
Analyst consensus estimates BABA will report consensus revenue of $1.05T (+3.6% year-over-year) and EPS of $42.70 (-17.1% year-over-year) for the upcoming fiscal year. The following year, analysts project $1.16T in revenue.
06When does Alibaba Group Holding Limited (BABA) report its next earnings?
Alibaba Group Holding Limited is expected to report its next earnings on approximately 2026-05-13. Consensus expects EPS of $0.89 and revenue of $35.8B. Over recent quarters, BABA has beaten EPS estimates 67% of the time.
07How much free cash flow does Alibaba Group Holding Limited generate?
Alibaba Group Holding Limited (BABA) generated $2.6B in free cash flow over the trailing twelve months — a free cash flow margin of 0.3%. BABA returns capital to shareholders through dividends (1.3% yield) and share repurchases ($87.4B TTM).