As Alibaba Goes From ‘Uninvestable’ to FOMO, Should You Buy or Sell BABA Stock?

Core Viewpoint - Chinese stocks, particularly Alibaba, have seen a significant recovery after a period of intense regulatory scrutiny, with a notable resurgence in investor interest and stock performance [1][3]. Group 1: Historical Context - The Chinese tech crackdown in 2020 and 2021 led to a perception of Chinese stocks as "uninvestible," particularly affecting emerging sectors like edtech [1]. - Alibaba was a prominent target during this crackdown, especially after co-founder Jack Ma's public criticism of regulators, which resulted in the cancellation of Ant Financial's IPO [2]. Group 2: Stock Performance - Alibaba's stock, which had briefly fallen below its 2014 IPO price, has more than doubled in 2025, indicating a strong recovery and investor interest [3]. - The fear of missing out (FOMO) has driven renewed investment in Alibaba, with notable investors like Cathie Wood re-entering the stock after previously selling during the crackdown [3]. Group 3: Macro and Company-Specific Factors - China's stimulus measures and President Xi Jinping's supportive meeting with entrepreneurs have positively influenced sentiment towards Chinese stocks [4]. - The emergence of artificial intelligence (AI) as a significant market trend has also contributed to the rally, with Chinese companies beginning to capitalize on this opportunity [4]. Group 4: Alibaba's AI Strategy - Alibaba's Cloud Intelligence Group reported a 26% increase in revenues in the June quarter, with AI-related revenue constituting 20% of external customer revenues [5]. - The cloud business has experienced triple-digit growth for eight consecutive quarters, highlighting the company's strong performance in the AI sector [5].