What's Going On With Alibaba Stock Tuesday?

Alibaba Group Holding Limited BABA stock is trading lower on Tuesday. The company has significantly increased its presence at CES in Las Vegas alogn with other Chinese firms, showcasing a solid comeback with over double the exhibitors compared to the previous year. 

Alibaba, through its subsidiary Alibaba.com Singapore, joined other major Chinese tech firms like ByteDance, TCL, and Lenovo, highlighting their growth and expansion efforts in the post-Covid era, SCMP reports. 

At CES, Alibaba was noted explicitly for leveraging machine learning platforms to enhance e-commerce, reflecting the company's continued push into innovative technology solutions in the global market.

Meanwhile, Alibaba and PDD Holdings Inc PDD, two of China's largest e-commerce companies, have been expanding aggressively in South Korea, offering competitively priced products on their platforms, AliExpress and Temu.

While AliExpress has seen its monthly active users in South Korea nearly double since 2018, reaching 7 million, and Temu averages 3.5 million users monthly, Korean consumers remain cautious due to extended delivery times and concerns over product quality, SCMP reports.

Despite efforts to improve supply chain efficiency, like Alibaba's "AliExpress Choice" for faster delivery and expanded warehouse capacity, issues like the authenticity of products and copycat designs persist, making it challenging for Chinese platforms to replace local Korean online retail sites.

Morgan Stanley has reduced its price target for Alibaba shares from $85 to $80 while maintaining an Equal-Weight rating. 

The bank anticipates Alibaba will report a challenging transitional quarter and suggests that the company's business transformation will require time. However, Morgan Stanley also notes that improved capital management could be a positive driver for the company.

The stock lost over 34% last year versus the broader index SPDR S&P 500 SPY, which gained over 22%.

Price Action: BABA shares traded lower by 1.89% at $71.50 premarket on the last check Tuesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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