| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 31 | 24.4x | 17.8x | Bottom tier | |
Growth | 39 | 4.3% | 7.1% | Bottom tier | |
Quality | 31 | 0.0% | 4.5% | Bottom tier | |
Safety | 57 | 1.6x | 2.6x | Around median | |
Capital Return | 31 | 2.44% | 2.12% | Bottom tier | |
Momentum | 23 | -6.3% | 2.9% | Bottom tier | |
Sentiment | 74 | 19 | 3 | Top tier |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
Alibaba Group Holding Limited operates through an ecosystem combining e-commerce, cloud computing, artificial intelligence, and consumer services. In Q1 of fiscal year 2027, the E-commerce Group generated revenue of 205.9 billion yuan, distributed across China e-commerce, quick commerce, international commerce, and global wholesale commerce, while the cloud business benefits from selling computing and storage capacity, models as a service, and artificial intelligence applications. The company reorganized its segment reporting into the E-commerce Group, Cloud and AI Computing Services, AI Labs and Applications, and Other Businesses.
In Q1 of fiscal year 2027, the group's revenue rose 9% year over year to 269 billion yuan, but adjusted earnings before interest, taxes, depreciation, and amortization declined 30% to 27.3 billion yuan, and net income under accounting standards fell 75% to 10.4 billion yuan. The E-commerce Group generated adjusted earnings before interest, taxes, depreciation, and amortization of 39.7 billion yuan, nearly unchanged year over year, while AI Labs and Applications recorded a loss of 13.9 billion yuan and Other Businesses recorded a loss of 3.3 billion yuan. By contrast, cloud revenue rose 45%, and the segment's adjusted earnings margin reached approximately 12%, showing that improving cloud economics have not yet fully offset the cost of intensive technology investment.
For fiscal year 2026, revenue amounted to 1,023.7 billion dollars and gross profit to 407.5 billion dollars, compared with revenue of 996.3 billion dollars and gross profit of 398.1 billion dollars in fiscal year 2025. Accordingly, the gross profit margin changed slightly from approximately 40.0% to approximately 39.8% based on the reported figures, while net income declined from 130.1 billion dollars to 103.6 billion dollars and earnings per share fell from 6.7 to 5.5. These figures reflect limited annual revenue growth alongside clear pressure on profitability, despite strong acceleration within cloud and artificial intelligence.
Analyst consensus rates BABA stock a Buy, with an average target of 183.17 dollars within a wide range of 160 to 209 dollars; the average is only a limited distance from the 52-week range high of 192.67 dollars, while the highest target exceeds that peak. By contrast, the price-to-earnings ratio of 28.6 times cited in the August 24, 2026 news imposes valuation discipline following the 75% decline in net income in Q1 of fiscal year 2027, while the wide 52-week range of 91.99 to 192.67 dollars reflects high sensitivity to expectations for returns on artificial intelligence spending and dilution risks resulting from the August 2026 offering.
Figures in the text are as of 2026-08-26; the live price is shown at the top of the page.
Alibaba Cloud was the clearest driver, with external revenue growing 45% year over year, its highest rate in 22 quarters. Artificial intelligence-related products generated 12.4 billion yuan in quarterly revenue and represented 35% of external cloud revenue. The segment's adjusted earnings margin also increased to 11.6%–12%, and management expects growth to continue accelerating and the margin to improve in subsequent quarters.
The Q1 fiscal year 2027 results indicate the generation of actual commercial revenue, as the annualized revenue run rate for artificial intelligence-related products exceeded 49.5 billion yuan after 12 consecutive quarters of triple-digit growth. The annualized revenue run rate for model and application services exceeded 16 billion yuan in August 2026, and management is targeting 30 billion yuan by the end of 2026. However, free cash flow recorded an outflow of 44.7 billion yuan, so the investment cycle has not yet translated into positive cash generation at the group level.
In Q1 of fiscal year 2027, revenue rose 9% to 269 billion yuan, but net income declined 75% to 10.4 billion yuan. The company attributed this to lower income from operations, reduced gains from investment disposals, and changes in the market value of investments, alongside capital expenditures of 67.7 billion yuan on cloud infrastructure. The AI Labs and Applications segment also recorded an adjusted loss of 13.9 billion yuan due to investment and higher inference costs in the Qwen application.
Automated analysis for informational purposes only — not investment advice.
Alibaba connects T-Head chips, its data centers, and Qwen models to reduce reliance on commercial chips and improve the cloud margin. Zhenwu chips were serving more than 650 customers in early August 2026, while the company launched the Zhenwu M890 supernode, capable of running inference for models exceeding two trillion parameters. Downloads of the Qwen series surpassed three billion, with more than 300 thousand derivative models created, which could convert the adoption of open models into demand for Alibaba Cloud services.
The secondary offering in Hong Kong raised 80 billion Hong Kong dollars, equivalent to approximately 10.2 billion U.S. dollars, to finance artificial intelligence expansion. The offering price was set at 112.70 Hong Kong dollars per share at an 8.4% discount, leading to concerns about dilution of existing shareholders' stakes. On August 24, 2026, the 8.54% decline in the Hong Kong listing exceeded the estimated mechanical dilution of approximately 3.57%, indicating additional concern about returns on spending and capital allocation efficiency.
E-commerce Group revenue amounted to 205.9 billion yuan, up 4%, and its adjusted earnings remained nearly stable at 39.7 billion yuan. China quick commerce grew 45% to 53.3 billion yuan with support from Freshippo and Taobao Instant Commerce, alongside improving unit economics and quarter-over-quarter reductions in losses. By contrast, customer management revenue declined 7%, and management set fiscal year 2029 as the target for quick commerce to reach overall profitability.
