US Tiger Securities Downgrades Alibaba (BABA) to Hold

US Tiger Securities analyst Bo Pei downgraded Alibaba (NYSE: BABA) from Buy to Hold with a price target of $180.00 (from $145.00).

The analyst comments "We are downgrading Alibaba to HOLD from BUY, while lifting our price target to $180 (from $145). Our constructive view on the mid- to long-term trajectory of Alibaba’s AI, cloud, and platform investments remains intact. However, we believe much of the upside has already been priced in following the sharp recent rally, leaving shares more vulnerable to near-term downside risk. Strong rally YTD / recent momentum. BABA has staged an exceptional run in 2025, with shares up more than 100% YTD and over 40% in the past month. We attribute this outsized move to renewed investor optimism around its AI/cloud pivot following the recent quarterly results, a series of encouraging corporate announcements, and broader improvements in sentiment toward Chinese technology names. Recent catalysts driving incremental gains. Shares gained more than 8% intraday on the back of multiple positive developments. At its recent tech conference, Alibaba unveiled Qwen3-Max, a large language model with over 1 trillion parameters, positioning it more aggressively in the AI arms race. The company also disclosed plans to boost its AI spending beyond an original 380 billion yuan (~USD 53 b) commitment, signaling a more aggressive stance. A new strategic collaboration with Nvidia — to integrate Nvidia’s AI tools and support robotics development — has also been well received by the market. Valuation no longer at a discount. For much of the past five years, Alibaba traded at a steep discount to U.S. peers due to growth, competition, and macro/regulatory concerns. Per FactSet, BABA’s average NTM EV/EBITDA multiple was 9.4x, a ~42% discount to Amazon’s 16.1x. Following the recent surge, BABA now trades at 13.3x NTM EBITDA, essentially in line with Amazon’s 13.0x — removing the valuation cushion that previously underpinned our Buy call. We continue to see long-term value in Alibaba’s strategic shift toward AI and cloud, with potential to drive durable growth and margin expansion. However, given the sharp re-rating, the risk/reward has become less attractive in the near term. We therefore move to HOLD, preferring to await a more favorable entry point before turning more constructive again. Our estimates are unchanged."

For an analyst ratings summary and ratings history on Alibaba click here. For more ratings news on Alibaba click here.

Shares of Alibaba closed at $176.44 yesterday.

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