Sell Alibaba Stock After 2x Surge This Year?

Core Viewpoint - Alibaba's stock has experienced a significant resurgence, nearly doubling since January 2025, driven by advancements in generative AI and strong performance in its cloud segment [3][4]. Group 1: Stock Performance - Alibaba's shares have risen by approximately 30% in September 2025 alone, making it one of the best-performing tech stocks of the year [3]. - The stock is currently trading at nearly $180, reflecting a forward earnings multiple of about 23x, which is more than double the 10x multiple from a year ago [8]. Group 2: AI Advancements - The company introduced Qwen3-Max, a large language model with over 1 trillion parameters, excelling in complex reasoning and coding tasks, outperforming many global competitors [5]. - AI-driven revenues have shown triple-digit growth for eight consecutive quarters, indicating strong momentum in this segment [6]. Group 3: Cloud and Infrastructure - Alibaba's cloud segment grew by 26% year-on-year in the latest quarter, highlighting the importance of back-end infrastructure for scaling AI services [6]. - The company has developed a new 7-nanometer AI inference chip, enhancing its capabilities in real-time inferencing tasks [6]. Group 4: Investments and Partnerships - Alibaba has committed to investing over RMB 380 billion (approximately $53 billion) in AI infrastructure and development, with plans to exceed this amount due to rising demand [7]. - The partnership with Nvidia aims to integrate advanced AI development tools into Alibaba Cloud, enhancing capabilities in physical AI applications [7]. Group 5: Growth Outlook - Despite the strong performance in AI revenues, the overall growth outlook for Alibaba is less optimistic, with consensus projections indicating only 5% sales growth in 2025 [8]. - In comparison, global competitors like Alphabet are projected to grow revenue by over 13% this year, highlighting a disparity in growth expectations [8].