Navigating Alibaba's Bumpy Road: Analyst Holds Positive, Adjusts Price Target Downward

Susquehanna analyst Shyam Patil maintains Alibaba Group Holding Ltd BABA with a Positive, lowering the price target from $175 to $160.
BABA continues to face pressure related to the macro and lingering pandemic impacts, though the Chinese macro appears to have improved somewhat, and cost discipline continues to pay off.
Looking further ahead, Patil sees the restructuring as a potential long-term value driver, as each company can surface additional operating metrics and can better focus on individual business and financing needs.
He views BABA as the leading China e-commerce player with ample secular growth opportunities.
The 4Q revenue growth rate held steady from 3Q, reflecting a general stabilization in the Chinese macro.
EBITDA was in-line with Patil's estimate and 4% above consensus, as BABA continues to deliver on cost-control initiatives.
Last week, Alibaba's board approved a complete spinoff of the Cloud Intelligence Group via a stock dividend distribution.
The board also backed the process to start external financing for Alibaba International Digital Commerce Business Group, exploration of IPO for Cainiao Smart Logistics Group, and execution of IPO for Freshippo.
Price Action: BABA shares traded lower by 3.44% at $83.14 on the last check Tuesday.

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