We recently published a list of Billionaire Ray Dalio’s Bridgewater’s 10 Stock Picks with Huge Upside Potential. In this article, we are going to take a look at where Alibaba Group Holding Limited (NYSE:BABA) stands against other billionaire Ray Dalio’s Bridgewater’s stock picks with huge upside potential.
Up until February 18, 2025, the stock market seemed poised to replicate the 2020-2022 bull run. Save for slight corrections in April and August of 2024, the market was in a general upside trend. And investors expected the trend to intensify, thanks to the Trump effect. But before President Trump’s re-election, some voices, including that of Ray Dalio, pointed out the potential risks of this presidency to the market.
Ray Dalio established Bridgewater Associates in 1975. But as of 2025, the billionaire investor isn’t part of the hedge fund’s key management. He currently acts as co-chief investment officer (CIO) mentor and member of the Bridgewater Board. Dalio also runs his family office, the Dalio Family Office, which manages over $15 billion in assets. He also does philanthropy work and he hasn’t stepped away from sharing his economic and investment insights through books, interviews, and social media.
Bridgewater has grown to become the largest and most renowned investment firm in the world. Over the past 10 years, the fund has returned 39.40%, and 17.30% over the past 12 months. However, just like Dalio predicted, the Trump administration’s policies could jeopardize Bridgewater’s ability to reward investors.
Since taking office for the second term, Trump has made tariffs a key part of his government’s economic policy. He issued an executive order on his first day in office and threatened 25% tariffs on all goods from China, Canada, and Mexico. The tariffs escalated through Liberation Day in April. All this time, the S&P 500 was taking one hit after another. For instance, the broad market index pulled back 12% between April 2 and April 8, 2025. April 2 happens to be the day of Trump’s Liberation Day speech that marked a major tariff escalation.
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Although the equity market appears to be correcting as of May 1, 2025 (the S&P 500 is up 12% since April 8), Dalio believes that Trump’s tariffs have wrought irreversible damage. According to a post on X on Monday, Dalio said that many of his indicators tell him that “we are on the brink of the monetary order, the domestic political and the international world orders breaking down due to unsustainable, bad fundamentals.”
While appearing on NBC’s “Meet the Press” show recently, Dalio sustained his dissatisfaction with Trump’s tariffs. According to the billionaire investor, President Trump’s actions are pushing the US to the brink of recession, or potentially “something worse.” He specifically pointed out the chaotic implementation of tariffs, which have caused global market volatility and economic uncertainty.
If Dalio is trying to say that the market is spooked, he is not wrong. According to the CBOE Volatility Index or VIX (which measures market sentiment), investors are very frightened. The index rose to the highest level in five years after the Liberation Day speech but climbed down afterward. Nevertheless, the index is still up 14% from where it was 30 days ago.
Amid the heightened fear in the equities market, Dalio’s Bridgewater continues to register gains. In Q1 2025 alone, the fund rose 9.9%. That the fund can post such growth in a difficult market speaks volumes about its management. This is why it is prudent to learn more about the billionaire’s stock picks with huge upside potential.
Our Methodology
We sifted through Bridgewater Associates SEC Q4 2024 13F filings. We focused on the fund’s most valuable equities holdings (excluding ETFs and options) and then ranked the stocks based on analyst price targets (as of May 2). We picked stocks with an upside potential of at least 30% and then ranked them in ascending order.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
An e-commerce platform displaying a wide range of products to customers online.
Alibaba Group Holding Limited (NYSE:BABA)
Bridgewater Associates Stake Value: $21,623,400
Upside Potential as of May 2: 32.90%
Number of Hedge Fund Holders: 107
Alibaba Group Holding Limited (NYSE:BABA) is a major Chinese technology conglomerate, operating across e-commerce, cloud computing, logistics, and digital services.
In the last quarter of 2024, Alibaba Group Holding Limited (NYSE: BABA) saw 8% revenue growth to $38.38 billion, with operating income rising 83% to $5.65 billion and adjusted EBITA increasing 4% to $7.52 billion. Net income soared 333% to $6.71 billion, driven by strong investments and core business performance. Earnings per ADS reached $2.79, and non-GAAP EPS grew 13% to $2.93. Alibaba Cloud’s revenue jumped 13% YoY, fueled by demand for AI services. To strengthen its AI and cloud capabilities, Alibaba plans to invest $52.4 billion over three years. CEO Eddie Wu emphasized AI model development, while Chairman Joe Tsai warned about unsustainable AI spending trends.
On April 29, Alibaba Group Holding Limited (NYSE: BABA) launched Qwen 3, an upgraded AI model with hybrid reasoning capabilities, amid rising competition in China’s AI sector. The move follows the success of DeepSeek, a local startup that claims to outperform Western models at lower costs. Alibaba has a Strong Buy rating from 16 analysts, all recommending a buy. The average price target is $167.13, ranging from $146.00 to $190.00, suggesting a 32.90% increase from its current price of $125.76.
Overall, BABA ranks 8th on our list of billionaire Ray Dalio’s Bridgewater’s stock picks with huge upside potential. While we acknowledge the potential of BABA as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than BABA but that trades at less than 5 times its earnings check out our report about this cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
