Alibaba Group (NYSE:BABA) Shares Down 2.6% – Should You Sell?

Alibaba Group Holding Limited (NYSE:BABA)’s share price fell 2.6% on Friday . The stock traded as low as $169.47 and last traded at $169.70. 10,746,530 shares changed hands during trading, a decline of 30% from the average session volume of 15,452,530 shares. The stock had previously closed at $174.25.

Key Stories Impacting Alibaba Group

Here are the key news stories impacting Alibaba Group this week:

• Positive Sentiment: Alibaba’s chip unit T-Head unveiled the self-developed AI chip Zhenwu 810E, which the company says completes its AI “golden triangle” (chip, cloud, models). This strengthens Alibaba’s cloud/AI moat and reduces reliance on foreign suppliers. Alibaba’s T-Head unveils self-developed AI chip Zhenwu 810E
• Positive Sentiment: Alibaba struck a major logistics deal (~$2 billion) to deploy Robovans and is consolidating logistics and autonomous-driving units (Zelos), aiming to cut delivery costs and scale automated fulfillment — a long-term cost-saver that supports margins if execution succeeds. Alibaba Reshapes Logistics With $2 Billion Robovan Deal
• Neutral Sentiment: Alibaba and ByteDance plan new AI model launches for Lunar New Year — shows intense domestic AI competition but also validates large addressable demand for Chinese generative-AI services. Competitive dynamics could spur adoption but also require continued spending. ByteDance and Alibaba to release new AI models for Lunar New Year – Information
• Neutral Sentiment: Media coverage of analyst ratings remains mixed; some Wall Street commentary is bullish on BABA’s long-term AI/cloud story but investors should treat upgrades/downgrades as sentiment drivers rather than fundamentals. Is It Worth Investing in Alibaba (BABA) Based on Wall Street’s Bullish Views?
• Negative Sentiment: Near-term margin pressure: Q2 FY26 results and analyst write-ups highlight modest revenue growth but steep margin erosion as competition and heavy AI/logistics spending weigh on profits — a key reason for today’s downward price move. BABA’s Margins Suffer From Stiff Competition: Time to Sell the Stock?

Analysts Set New Price Targets

Several research firms recently weighed in on BABA. Jefferies Financial Group lowered their target price on Alibaba Group from $231.00 to $225.00 and set a “buy” rating on the stock in a research report on Thursday, January 8th. Citigroup boosted their price objective on Alibaba Group from $218.00 to $225.00 and gave the company a “buy” rating in a research note on Wednesday, November 26th. Macquarie reissued an “outperform” rating on shares of Alibaba Group in a report on Tuesday, November 25th. Freedom Capital downgraded shares of Alibaba Group from a “strong-buy” rating to a “hold” rating in a report on Tuesday, January 6th. Finally, Morgan Stanley dropped their price target on shares of Alibaba Group from $200.00 to $180.00 and set an “overweight” rating for the company in a research report on Thursday, January 8th. Eighteen equities research analysts have rated the stock with a Buy rating, one has assigned a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat.com, Alibaba Group presently has an average rating of “Moderate Buy” and an average target price of $195.17.

Alibaba Group Trading Down 2.6%

The stock has a market cap of $405.14 billion, a P/E ratio of 23.44, a price-to-earnings-growth ratio of 3.83 and a beta of 0.37. The stock’s 50-day moving average is $158.25 and its two-hundred day moving average is $151.60. The company has a debt-to-equity ratio of 0.23, a current ratio of 1.46 and a quick ratio of 1.46.

Institutional Investors Weigh In On Alibaba Group

A number of hedge funds have recently made changes to their positions in the company. Capital World Investors lifted its holdings in shares of Alibaba Group by 1,074.9% in the 3rd quarter. Capital World Investors now owns 6,038,318 shares of the specialty retailer’s stock worth $1,079,229,000 after acquiring an additional 5,524,354 shares during the last quarter. Norges Bank purchased a new stake in Alibaba Group in the 2nd quarter worth about $527,243,000. Alkeon Capital Management LLC bought a new stake in Alibaba Group in the second quarter worth about $184,291,000. Artisan Partners Limited Partnership purchased a new position in shares of Alibaba Group during the third quarter valued at approximately $290,208,000. Finally, Trivest Advisors Ltd purchased a new position in shares of Alibaba Group during the third quarter valued at approximately $202,126,000. 13.47% of the stock is currently owned by hedge funds and other institutional investors.

About Alibaba Group

Alibaba Group Holding Limited is a Chinese multinational conglomerate founded in 1999 in Hangzhou, China, by Jack Ma and a group of co?founders. The company built its business around internet-based commerce and related services and has grown into one of the largest e-commerce and technology companies in the world. Alibaba completed a high?profile initial public offering on the New York Stock Exchange in 2014.

The company operates a portfolio of online marketplaces and platforms serving different customer segments: Alibaba.com for global and domestic B2B trade, Taobao for consumer-to-consumer shopping, and Tmall for brand and retailer storefronts targeted at Chinese consumers.