Alibaba Stock Soars 87%. Time to Sell, or Are We Just Getting Started?

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Alibaba Group (BABA) has been something of a drama queen for investors over the years, playing the role of tech darling one moment, and then a stock market villain the next. With China’s regulators dropping the hammer, consumer spending on a slow burn, and rivals like Pinduoduo and Meituan getting feisty, Alibaba went from a red carpet winner to the equivalent of a half-eaten sandwich. Not pretty, folks. But-plot twist!-in 2025, the stock is back with a vengeance, shooting up a whopping 87% over the past 12 months (yes, you read that right) as of September 17, crushing not just the Hang Seng Index, but even leaving the Nasdaq Composite wondering what hit it. So, should you cash in your chips, or let this one ride out like a late-night infomercial for high-speed blenders? The suspense is real.

So, What’s Fueling the Alibaba Rocket?

This isn’t some impulsive sugar rush, folks. No, no. This rally has meat on its bones. Alibaba’s not just some stock flapping around aimlessly. The company has actually started delivering results in areas that investors like you and me care about, and you better believe it’s not just a momentary blip.

In the June 2025 quarter (fiscal Q1 2026), Alibaba posted a revenue of RMB 248 billion ($34.6 billion), marking a solid 10% year-over-year growth. It’s like they found the secret sauce to revive what seemed like a dying engine. And the big win? Their cloud business. Alibaba Cloud revenue soared 26% to RMB 33.4 billion ($4.7 billion). Plus, AI-related revenue is growing at a rate so fast, it could make your head spin-up in triple digits for the eighth consecutive quarter. No, seriously, I’m not kidding.

That’s the golden nugget right there-cloud and AI. They’re no longer the “just-make-some-good-ideas” department. They are now the big dogs. And with Alibaba’s large language model, Tongyi Qianwen, making appearances across various applications, Alibaba’s positioning itself not just as an e-commerce juggernaut, but a serious contender in the AI realm. I’m talking big leagues.

Now, Alibaba isn’t sitting on its laurels. Oh no. They’ve also been hustling in quick commerce to keep up with the ever-vicious competition from Meituan and Pinduoduo. It’s a short-term cost burden, sure, but it’s a move that signals Alibaba’s no longer in the “cutting costs only” phase. They’re playing offense, baby. And you know what? E-commerce grew by 10% year-over-year in the latest quarter. A win is a win.

In short, it’s a beautiful thing: solid numbers, AI innovation, and a strategy that’s finally gaining traction. If this was a movie, I’d be cheering.

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The Temptation to Sell… Too Soon?

Now, I get it. The stock’s been on a rollercoaster, and after nearly doubling in price, it’s tempting to take the money and run. But hold up-before you race to the exits, remember one thing: Selling now could mean missing the next part of the ride. And you don’t want to be that guy who left the party early only to find out they missed the best part.

Here’s a little nugget of wisdom: Alibaba’s stock is still trading way below its peak valuation. At a price-to-sales ratio of just 2.8, these shares are looking more like a garage sale find than a tech titan. For perspective, back in 2020, the stock was going for 7-9 times that number. So, even after this monster rally, Alibaba is still priced more like a big-box retailer than a high-flying tech empire with a whole buffet of growth engines.

And, let’s be real, folks-the sentiment is just starting to shift. Analysts from Mizuho, Bernstein, and Citi are raising their price targets or reaffirming their bullish stances. Why? Because they’re starting to recognize that Alibaba’s cloud and AI might just be the underappreciated catalysts for the next leg of this rally. If earnings momentum continues, expect more institutional investors to hop on this gravy train.

So, before you make a move, consider this: The fundamentals aren’t shouting “top of the market” just yet. This recovery? It could still be in its early innings. Play it right, and you could be sitting pretty.

But, Don’t Get Too Comfortable

Now, as much as I’d love to tell you this story has a happy ending with a bow on top, let’s not kid ourselves. Alibaba still has a long road ahead. Competition is fierce in the e-commerce space, with Pinduoduo’s cutthroat low prices and Meituan’s grip on local services. Plus, Alibaba’s still digging deep into its pockets to fund quick commerce, which hit profitability in the latest quarter. Non-GAAP net income fell 18%, even though revenue looked pretty good. It’s like having a slice of cake that looks great, but when you take a bite, you realize it’s all frosting and no substance.

And don’t forget about geopolitics, folks. Tensions between the U.S. and China might throw a wrench into Alibaba’s cloud and AI plans. But Alibaba’s no fool-they’re countering that risk by developing their own domestic AI chips. Talk about preparing for the storm.

Bottom line: Buckle up. Volatility is still part of the ride. But if Alibaba can keep executing, the long-term trajectory looks far from bleak.

What Does This Mean for You, Investor Extraordinaire?

Here’s the deal: Alibaba’s 2025 rally is a sight to behold, but let’s keep the context in mind. The stock is rebounding from low levels and still sports some pretty attractive valuations. The company’s cloud and AI story is for real, and some analysts are starting to notice. But-and it’s a big “but”-Alibaba still has plenty of dragons to slay before it’s smooth sailing.

So, should you sell? Well, if you’re in it for the long haul, you might want to hang tight and enjoy the ride. After all, Alibaba is going from being a “broken” stock to one with potential. Think of it like a grizzled old hero coming out of retirement to save the day. It might take a few more quarters, but the recovery could still have some juice left. So, sit back, relax, and let the market do its thing-unless you really just can’t resist the temptation of that sweet, sweet profit.

For the long-term believers, keeping your shares is probably the play. And hey, at least you’ll get a good story out of it. 🤑

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2025-09-19 16:44