10 Most Profitable Cheap Stocks to Buy Now

3. Alibaba Group Holding Limited (NYSE:BABA)

Forward P/E: 11.99

TTM Net Income: $16.77 Billion

Number of Hedge Fund Holders: 107

Alibaba Group Holding Limited (NYSE:BABA), or simply Alibaba, is a Chinese multinational technology company that ranks among the most profitable cheap stocks to buy now. The company owns a wide range of businesses across e-commerce, retail, local consumer services, cloud, internet, and digital media and entertainment.

On April 14, Barclays reiterated its “Overweight” rating on Alibaba Group Holding Limited (NYSE:BABA) and maintained a price target of $180. The firm’s analyst highlighted the rapid growth of the company’s cloud business, which is expected to grow throughout the remainder of the year. Barclays believes that cloud margins will likely remain stable as Alibaba Group Holding Limited (NYSE:BABA) is currently focused on improving customer adoption of AI during what they call the industry’s “land grab” phase. China’s AI industry is shifting from training large language models (LLMs) to inferencing and then to edge AI. As a result, Alibaba Group Holding Limited (NYSE:BABA) is set to benefit early since it is the largest AI infrastructure provider in China. Barclays also noted that the company’s cloud business generates about $20 billion in revenue and $2 billion in EBITA annually, with growth rates picking up pace. The firm believes that the true value of Alibaba Group’s (NYSE:BABA) cloud division is not fully reflected in the current share price.