Analysts Are Cutting Price Targets of These 5 Stocks

01. Alibaba Group Holding Limited (NYSE:BABA)

Number of Hedge Fund Holders: 113

On May 23, Shyam Patil, an analyst at Susquehanna, decreased the price target for Alibaba Group Holding Limited (NYSE:BABA) from $175 to $160 and maintained a Positive rating on the company’s shares. The analyst acknowledges that Alibaba Group Holding Limited (NYSE:BABA) is still encountering challenges stemming from macroeconomic factors and the persistent effects of the pandemic. However, there are signs of improvement in the Chinese macro environment, and the company’s commitment to cost discipline is yielding positive results.

Earlier in May Alibaba Group Holding Limited (NYSE:BABA) posted its fiscal Q4 results. Adjusted EPADS for the fourth quarter came in at $1.56, beating estimates by $0.21. Revenue jumped 2% year over year to $30.32 billion, beating estimates by $410 million.

L1 Long Short Fund made the following comment about Alibaba Group Holding Limited (NYSE:BABA) in its Q1 2023 investor letter:

“Alibaba Group Holding Limited (NYSE:BABA) (Long +16%) shares performed strongly based on favourable sentiment surrounding China’s re-opening and indications from Chinese authorities that the prolonged restructuring process of Alibaba/Ant Financial was finally drawing to a close. The company remains a high-quality business with leading positions in both eCommerce and Public Cloud. We exited our position in January at around US$116 per share with the shares having rallied more than 90% since their early November lows and our China re-opening catalyst having played out. We subsequently re-entered the position in March with the shares having pulled back and with the company announcing a new organisational and governance structure. Alibaba has announced plans to split into six major business groups – Cloud Intelligence, Taobao Tmall, Local Services, Global Digital, Cainiao Smart Logistics and Digital Media and Entertainment Group. Each of these groups will be managed independently (separate CEO and board) and have the flexibility to raise external capital and potentially pursue separate IPOs. We believe this announcement is a strong catalyst to unlock the inherent sum-of-the-parts valuation discount in the company.”

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