U.S.-listed Alibaba Group stock was pushing higher in early trading Monday, adding to a strong month for shares of the Chinese e-commerce and cloud-computing giant.
The gains Monday comes as Wall Street analysts offered bullish views on Alibaba following the company's cloud conference in China last week. At the conference, Alibaba Group Chief Executive Eddie Wu said the company will exceed its previously announced plans to spend roughly $53 billion over three years to develop AI infrastructure. Wu told an industry conference in China that demand for AI infrastructure far exceeded the company's expectations.
That news — paired with a new partnership with Nvidia focused on physical AI — boosted Alibaba stock to its highest level since October 2021. Shares gained 8% last Wednesday before pulling back by 2.5% over trades Thursday and Friday.
Alibaba stock gained more than 3% to 177.89 in premarket trades on the stock market today.
Analysts Boost View Of Alibaba
Morningstar raised its fair value estimate for Alibaba stock by 49% to 267 in a research note late in the day Friday. The note pointed to Alibaba's decision to boost capital expenditures for AI.
"We think higher capex is essential to meet the stronger-than-expected demand for AI infrastructure domestically and internationally," Morningstar analyst Chelsey Tam wrote. "The projected surge in global data center energy consumption signals a robust outlook for cloud revenue."
Analysts at Jefferies, meanwhile, cited Alibaba's cloud momentum and raised their target for Alibaba stock to 230 from a previous 178 in a client note Monday, according to a description published by The Fly.
The notes are among more than a dozen from analysts that have increased their target price for Alibaba stock this month, according to tracking from FactSet. The average target price for Alibaba stock among the 53 analysts covering Alibaba stock is 181.32, according to FactSet. That's up from 160.75 at the end of August.
Most analysts were already bullish, with Alibaba stock boasting a buy or equivalent rating form 92% of analysts with coverage.
Alibaba Stock Up 27% This Month
U.S.-listed Alibaba stock has rallied more than 102% year-to-date. That includes a 27% gain in September, not including Monday's early gains.
Alibaba stock's rally this month was ignited by a strong fiscal Q1 earnings report posted Aug. 29 and news it was developing its own AI chip. Shares broke out above a consolidation pattern buy point of 148.43 on Sept. 11 and have climbed sharply beyond a 5% buy zone, according to MarketSurge
Meanwhile, Alibaba stock has an IBD Composite Rating of 91 out of a best-possible 99, according to IBD Stock Checkup. The score combines five separate proprietary ratings into one.
