Citi analyst Alicia Yap has maintained their bullish stance on BABA stock, giving a Buy rating yesterday.
Alicia Yap has given her Buy rating due to a combination of factors, including Alibaba’s strategic advancements in artificial intelligence. The recent launch of the Qwen reasoning model, QwQ, on Qwen Chat highlights Alibaba’s commitment to innovation in deep reasoning, particularly in areas such as mathematics, coding, and agent capabilities. This development is part of a broader strategy, underscored by Alibaba’s announcement of a significant capital expenditure investment of Rmb380bn over the next three years, aimed at capturing AI opportunities more rapidly.
Alicia Yap believes that these initiatives position Alibaba favorably against its peers, as the QwQ model is expected to benchmark well against other advanced reasoning models like DeepSeek-R1 and Kimi. The ongoing enhancements and future releases, including the QwQ-Max version and smaller variants for local deployment, demonstrate Alibaba’s dedication to maintaining a competitive edge in the AI space. These strategic moves reinforce the Buy rating, suggesting confidence in Alibaba’s ability to leverage its technological advancements for sustained growth.
In another report released yesterday, Susquehanna also maintained a Buy rating on the stock with a $175.00 price target.