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Alibaba Price Target Lifted by JPMorgan to Street High on Cloud

JPMorgan Chase & Co. has raised its price target for Alibaba Group Holding Ltd.’s Hong Kong shares by almost 45%, setting the highest target among analysts tracked by Bloomberg.

The new target of HK$240 ($31) a share by the end of 2026 implies a 36% gain from the close on Tuesday. The valuation at 12 times the bank’s fiscal 2028 earnings estimate for Alibaba “offers significant room” for upside, analysts led by Alex Yao wrote, citing an improved cloud-revenue outlook and growing synergy between its AI and e-commerce operations.

Alibaba’s Hong Kong-listed shares jumped 53% in September, the best performance on the Hang Seng Index. Investor enthusiasm surged after the company announced plans to hike AI spending past an original target of more than $53 billion, and a new partnership with Nvidia Corp. 

“Alibaba is positioned to participate at every stage – compute, platforms, and apps – while directly improving merchant economics” in generative AI, Yao said. Investors should look past the negative impact from a food delivery war and quick commerce in 2027, the report said.

The price-target boost comes from the team that in March 2022 referred to some Chinese internet stocks as “uninvestable” due to an editorial error.