MODEL VERDICT
Alibaba Group Holding Limited (BABA) — Relative Valuation
Peer multiples, Monte Carlo simulation & quality-adjusted fair value
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Peer multiples, Monte Carlo simulation & quality-adjusted fair value
Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
Each row records the model's monthly assessment. High Conviction = the model detected notable undervaluation vs peers. Neutral = no notable divergence was found. The return column shows the actual price change over 90 days for reference. This is a quantitative observation log — not investment advice.
| Date | Assessment | Score | Price | Status | 90d Fwd Return |
|---|---|---|---|---|---|
| Feb 28, 2026 | MODERATE | 0.68 | $144.11 | CURRENT | — |
| Feb 21, 2026 | MODERATE | 0.68 | $154.45 | CURRENT | — |
| Feb 14, 2026 | MODERATE | 0.68 | $155.73 | CURRENT | — |
| Feb 11, 2026 | MODERATE | 0.68 | $166.51 | CURRENT | — |
| Jan 11, 2026 | MODERATE | 0.70 | $150.96 | Pending | +8.0% |
Historical model observations for research purposes only. Past quantitative patterns do not predict future results. Not a recommendation to buy, sell, or hold any security.
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Forward P/E 43 analyst estimates | $892.84 | +519.6% | 20% | A- | Analyst Est. |
| EV/EBITDA 40 industry peers | $596.20 | +313.7% | 20% | A- | Peer Data |
| Industry Median P/E 36 industry peers | $1569.87 | +989.4% | 15% | A | Peer Data |
| Price / Free Cash Flow 38 industry peers | $746.34 | +417.9% | 15% | B+ | Peer Data |
| EV/EBIT 40 industry peers | $979.28 | +579.5% | 8% | B+ | Peer Data |
| EV/FCF 39 industry peers | $695.93 | +382.9% | 7% | B | Model Driven |
| EV To Revenue 51 industry peers | $648.80 | +350.2% | 4% | B | Data |
| Price / Sales 51 industry peers | $532.61 | +269.6% | 3% | B | Model Driven |
| Earnings Yield 36 industry peers | $1569.87 | +989.4% | 2% | B | Data |
| FCF Yield 39 industry peers | $748.73 | +419.6% | 1% | B | Data |
| Weighted Output Blended model output | $726.93 | +404.4% | 100% | 78 | SIGNIFICANTLY UNDERVALUED |
| EPS Growth ↓ | P/E Multiple → | 14× | 16× | 18× (Current) | 20× | 22× |
|---|---|---|---|---|---|
| Bear Case (2%) | $765 | $875 | $984 | $1093 | $1203 |
| Conservative (5%) | $788 | $900 | $1013 | $1126 | $1238 |
| Base Case (-3.1%) | $727 | $831 | $935 | $1039 | $1143 |
| Bull Case (-4%) | $719 | $822 | $924 | $1027 | $1130 |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/E Ratio | 3.48 | 2.82 | 2.17 | 6.33 | 1.39 |
| EV/EBIT | 2.34 | 2.39 | 0.90 | 4.94 | 1.35 |
| EV/EBITDA | 2.24 | 1.63 | 0.90 | 5.31 | 1.58 |
| P/FCF | 3.10 | 2.73 | 1.24 | 5.49 | 1.72 |
| P/FFO | 2.44 | 2.14 | 1.64 | 4.45 | 1.04 |
| P/TBV | 0.69 | 0.43 | 0.25 | 1.97 | 0.64 |
| P/AFFO | 3.88 | 4.15 | 2.08 | 7.39 | 1.86 |
| P/B Ratio | 0.40 | 0.30 | 0.18 | 0.90 | 0.28 |
| P/S Ratio | 0.61 | 0.36 | 0.23 | 1.48 | 0.52 |
Based on our peer multiples analysis with 26 valuation metrics, the model estimates BABA's fair value at $726.93 vs the current price of $144.11, implying +404.4% upside potential. Model verdict: Significantly Undervalued. Confidence: 78/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $726.93 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $556.47 (P10) to $814.95 (P90), with a median of $681.43.
BABA's current P/E of 18.4x compares to the industry median of 29.3x (36 peers in the group). This represents a -37.0% discount to the industry. The historical average P/E is 3.5x over 7 years. Signal: Deep Discount.
58 analysts cover BABA with a consensus rating of Buy. The consensus price target is $188.62 (range: $140.00 — $225.00), implying +30.9% upside from the current price. Grade breakdown: Strong Buy (0), Buy (51), Hold (6), Sell (1), Strong Sell (0).
The model confidence score is 78/100, based on: data completeness (27), peer quality (25), historical depth (20), earnings stability (4), and model agreement (2). Cyclicality penalty: -0 points. The model shows strong agreement across inputs.
The model flags several key risks: (1) Multiple compression: BABA trades at the 3060th percentile of its historical P/E range. A reversion to median (3.5×) would imply significant downside. (2) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk refers to the possibility that BABA's current profitability is above its sustainable long-term trend. The model detects a margin Z-score of -0.9σ, meaning margins are 0.9 standard deviations below their historical average. If margins revert to the 7-year mean (19.1%), the model estimates fair value drops by 10240.0% to approximately $292. This isn't a prediction — it's a scenario analysis.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.