A significant analyst upgrade and a groundbreaking energy partnership are reshaping the narrative around Alibaba’s competitive position in the artificial intelligence arena. The moves highlight a dual-front strategy: advancing AI-driven commerce while securing the foundational power required to run it.
A Vote of Confidence from the Market
The investment research firm Arete Research has shifted its stance on Alibaba from “Neutral” to “Buy,” accompanied by a substantial increase in its price target. The firm now sees the stock reaching $190, a jump from its previous target of $172, implying a double-digit upside from current levels.
This optimistic reassessment is rooted in emerging growth drivers within Alibaba’s core operations. Analysts point to the rollout of “agentic commerce” AI features across platforms like Taobao and Alipay. These tools are designed to automate and personalize purchasing journeys, potentially unlocking new revenue streams.
Crucially, Arete emphasized the strategic importance of Alibaba’s focus on energy security. In a sector where rivals like ByteDance are also making massive cloud and AI investments, guaranteeing a reliable, scalable power supply for data centers is viewed as a distinct competitive advantage.
Securing the Foundation: A Nuclear Energy Venture
In a parallel development that underscores its long-term planning, Alibaba has taken concrete steps to lock down its energy needs. The company is establishing a joint venture with state-owned China National Nuclear Power Co., committing 250 million yuan (approximately $35.9 million) to the partnership.
The initiative directly targets the immense power demands of AI infrastructure. Training large language models and operating the necessary data centers are extraordinarily electricity-intensive processes. By aligning with a nuclear power specialist, Alibaba is following a path already charted by U.S. tech giants such as Microsoft and Meta: utilizing nuclear energy as a stable, low-carbon source for the computational horsepower behind AI.
Market observers interpret this move as a bid to stabilize long-term infrastructure costs and provide greater certainty for the company’s ambitious AI expansion plans.
Should investors sell immediately? Or is it worth buying Alibaba?
Product Traction in a Fiercely Competitive Landscape
On the product front, Alibaba continues to demonstrate scale. Its proprietary Qwen family of AI models has surpassed a notable milestone, exceeding 700 million downloads. This widespread adoption highlights the models’ integral role within the company’s broader ecosystem.
Nevertheless, the competitive pressure remains intense. ByteDance’s aggressive push into cloud and AI services is squeezing margins and accelerating the need for continuous innovation. In this context, Alibaba’s three-pronged approach—integrating AI into commerce, scaling its model ecosystem, and now securing its energy base—gains strategic weight.
Key Developments at a Glance:
* Analyst upgrade to “Buy” with a $190 price target.
* Joint venture formed with China National Nuclear Power, valued at 250 million yuan.
* Qwen AI models have garnered over 700 million downloads.
* The average analyst consensus currently stands at “Moderate Buy,” with a mean price target of approximately $192.72.
The stock recently closed at 143.20 euros. This price represents a gain of over 72% in the past twelve months, though it still trades about 11% below its 52-week high.
The Road Ahead: From Strategy to Results
The current re-rating of Alibaba’s equity is largely based on these strategic pivots: embedding AI in commerce, proliferating its Qwen models, and pioneering nuclear-backed energy for its data centers. Notably, the below-average trading volume on the day of the analyst upgrade suggests activity was concentrated among decisive buyers rather than the broader market.
The next critical test arrives on February 19, 2026, when Alibaba reports its quarterly earnings. This disclosure will reveal whether the heavy investments in AI capabilities and energy infrastructure are beginning to translate into tangible revenue and profit metrics, or if they are primarily strengthening the company’s strategic positioning for the future.
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