Read What It Will Take For Alibaba's Most Accurate Analyst To Reverse His Sell Recommendation

DZ Bank AG's Manuel Muehl remained adamant on his sell recommendation on Chinese stocks, including Alibaba Group Holding Ltd BABA, amid hints toward possible ease in the regulatory crackdown.
Last summer, Muehl was the first to recommend the sell rating on Alibaba and JD.com, Inc JD, signifying higher accuracy than his peers.
Muehl called the optimism surrounding the possible end to DiDi Global Inc DIDI regulatory woes "a bit premature and highly undifferentiated."
Muehl did not find any reason to be bullish on the sector following slower revenue growth, margins, and free cash flow reflected in the latest quarterly results.
Muehl's target price of $85 for Alibaba and $49.5 for JD.com implies a downside of ~20% from their last close.
China recently released its gaming license approval list, which missed big names like Tencent Holding Ltd TCEHY and NetEase, Inc NTES, akin to the previous list.
A concrete deal with Washington to prevent the U.S. delisting of Chinese firms, a step-back from anti-monopoly rules, and a notable uptick in consumer confidence and spending can only reverse Muehl's bearish stance on the sector.
Price Action: BABA shares closed higher by 11.2% at $110.07 on Tuesday.
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