Jefferies Remains Bullish on Alibaba Group Holding (BABA)

Alibaba Group Holding Limited (NYSE:BABA) is one of the best long term low volatility stocks to buy now. Jefferies reiterated optimistic sentiments for Alibaba Group Holding Limited (NYSE:BABA) in its July note, stating that it is one of the top names to watch in China’s AI space as cloud spending continues and improvements in chip supply materialize.

Alibaba (BABA) Soars 8% on US Chip Exports Ease to China

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The firm raised Alibaba Group Holding Limited’s (NYSE:BABA) June-quarter forecast for revenue growth for the Cloud Intelligent Group to 23% from the prior 20%.

The upgrade comes as the company continually posts solid results in AI-related services, with cloud revenue growing 18% year-over-year in its fiscal Q4 2025 earnings report. AI-related product revenue for the quarter marked the seventh consecutive quarter of triple-digit growth.

Jefferies added that Alibaba Group Holding Limited’s (NYSE:BABA) steady capital spending is a key strength for the company. The company announced a $53 billion plan earlier this year to expand its AI and cloud business over the coming three years.

The firm also anticipates Alibaba Group Holding Limited’s (NYSE:BABA) advertising and merchant service revenue to rise by around 10.5% year-over-year, slightly above its earlier estimates, due to the support of higher service fees charged to sellers and improved monetization tools.

Alibaba Group Holding Limited (NYSE:BABA) manages and provides technology infrastructure and marketing platforms. It operates through seven segments: China Commerce, International Commerce, Local Consumer Services, Cainiao, Cloud, Digital Media and Entertainment, and Innovation Initiatives and Others segments.

While we acknowledge the potential of BABA to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than BABA and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.