BABA Stock: Why Analysts Can't Agree & What's Next
Alibaba's AI Hype Train: Or Just Another Overhyped Tech Promise?
Alright, let's get real about this Alibaba AI lovefest. Another day, another tech company promising to change the world with algorithms. Yawn.
The Qwen "Super-App" Mirage
So, Alibaba's Qwen app supposedly got 10 million downloads in a week. Okay, and? Remember Clubhouse? How's that revolution going? Downloads don't equal success, they equal… well, people clicking a button. Alibaba's New Qwen App Smashes 10 Million Downloads In A Week — And Sends Its Stock Soaring: Analysts See Clear Path To China's Next AI-Era WeChat - Alibaba Gr Hldgs (NYSE:BABA), Apple (NASDAQ:AAPL)
The analysts are already calling it "China's WeChat for the AI era." Give me a break. Every tech company wants to be the next WeChat, the next iPhone, the next sliced bread. It's the same tired story, repackaged for gullible investors. I mean, seriously, "AI era WeChat"? What does that even MEAN?
And speaking of analysts… BofA is still slapping a "Buy" rating on BABA, even after cutting the price target. That's analyst-speak for "we were wrong, but we don't want to admit it." They lowered the target to $188. That's still a 25% upside, they claim. Maybe in fantasyland.
Cloud Gains vs. Reality Check
The one bright spot seems to be the cloud business, which is supposedly up 34%. Triple-digit growth in AI-related revenue for nine straight quarters. Sure, numbers are fun. But who's actually using this stuff? What are they using it for? Is it actually solving problems, or just generating more buzzwords?
Oh, and they're burning cash on AI, cloud, and "quick commerce." Quick commerce? Is that like, instant gratification for groceries? We're literally throwing money at faster avocado delivery while the world's on fire. Priorities, people.
And let's not forget the e-commerce side, where things are "softening." Translation: people are realizing they don't need another gadget from Alibaba. The analyst expects customer management revenue to slow. No kidding.
Quick commerce losses are improving, though. They expect losses to drop to about 20 billion yuan next quarter. Only 20 billion! What a steal!
The Long Game... Or a Losing One?
Benzinga's Edge Stock Rankings say Alibaba has "solid growth prospects over the medium and long term." Do they now? Everyone's got an opinion, and most of 'em are worthless. The stock is up 82% over the past year, which is great if you bought it a year ago. But what about the next year? Or the year after that?
Meanwhile, some other site I couldn't even access because they think I'm a bot (thanks for that), is probably saying the sky is falling.
Institutional investors are piling in, too. Kingstone Capital Partners Texas LLC increased its holdings by a bajillion percent. Good for them. They're playing with other people's money. What do they care if it goes up in smoke?
Then again, maybe I'm just being cynical. Maybe Alibaba really is on the verge of something big. Maybe Qwen will become the AI-powered overlord of China. Maybe pigs will fly.
So, What's the Catch?
This whole thing feels like a house of cards built on hype. The numbers don't lie, but they sure can be twisted. I'm not buying it. Not yet, anyway.