Top 10 AI Stocks in the Spotlight on Wall Street

2. Alibaba Group Holding Limited (NYSE:BABA)

Number of Hedge Fund Holders: 125 

Alibaba Group Holding Limited (NYSE:BABA) is one of the Top 10 AI Stocks in the Spotlight on Wall Street. On September 25, US Tiger Securities analyst Bo Pei downgraded the stock from Buy to Hold with a price target of $180.0  (from $145.00). The downgrade reflects the firm’s belief that Alibaba’s stock has already rallied strongly and that much of the upside is already priced in.

The rally was driven by renewed investor optimism regarding the company’s AI/cloud pivot following the recent quarterly results, encouraging corporate announcements, and improved sentiment on Chinese tech stocks.

“We are downgrading Alibaba to HOLD from BUY, while lifting our price target to $180 (from $145). Our constructive view on the mid- to long-term trajectory of Alibaba’s AI, cloud, and platform investments remains intact. However, we believe much of the upside has already been priced in following the sharp recent rally, leaving shares more vulnerable to near-term downside risk. Strong rally YTD / recent momentum. BABA has staged an exceptional run in 2025, with shares up more than 100% YTD and over 40% in the past month. We attribute this outsized move to renewed investor optimism around its AI/cloud pivot following the recent quarterly results, a series of encouraging corporate announcements, and broader improvements in sentiment toward Chinese technology names. Recent catalysts driving incremental gains. Shares gained more than 8% intraday on the back of multiple positive developments. At its recent tech conference, Alibaba unveiled Qwen3-Max, a large language model with over 1 trillion parameters, positioning it more aggressively in the AI arms race. The company also disclosed plans to boost its AI spending beyond an original 380 billion yuan (~USD 53 b) commitment, signaling a more aggressive stance. A new strategic collaboration with Nvidia — to integrate Nvidia’s AI tools and support robotics development — has also been well received by the market.”

Overall, while the company’s push into cloud and AI looks promising, the firm believes that it’s better to wait for a cheaper entry point since the stock has already jumped a lot.

“We continue to see long-term value in Alibaba’s strategic shift toward AI and cloud, with potential to drive durable growth and margin expansion. However, given the sharp re-rating, the risk/reward has become less attractive in the near term. We therefore move to HOLD, preferring to await a more favorable entry point before turning more constructive again. Our estimates are unchanged.”

Alibaba Group Holding Limited (NYSE:BABA) is an internet giant that offers e-commerce services in China and internationally.