The shares rebounded slightly after Wall Street Journal reported that US lawmakers are planning to exclude Alibaba along with Baidu (NASDAQ: BIDU) and Tencent (OTCPK: TCEHY) from the list of banned Chinese companies. Previously, Alibaba, Baidu, and Tencent along with other dozen companies were scrutinized for possible addition to the Dept. of Defense list of companies that are supporting China’s military. The bearish trend is also supported by speculations related to Jack Ma’s missing, but he is not missing and “laying low,”, according to news reports. He is the founder of Alibaba and considered among the most powerful businessmen in the world. He has strongly criticized Chinese government policies in the last couple of months. He has been seeing a strong retaliation from the government, with an antitrust investigation into Alibaba (BABA) and pulling of the listing of Ant Group.
Analysts slash Alibaba stock targets
The market analysts, on the other hand, have started showing concerns over the future fundamentals of Alibaba. For instance, CFRA analyst John Freeman slashed BABA ratings to sell from hold, with a price target of $70. The firm shows concerns over the Chinese Communist Party’s restrictions on software-based businesses that disrupt banking or any industry that President Xi wants to tightly control. Baird analyst Colin Sebastian sets a price target of $285 amid regulatory pressure. Although the analyst is optimistic about Alibaba’s core businesses, Sebastian believes strict regulations could “open the door for competitors” to enhance their market share. Alibaba expects to generate high double-digit growth in revenues for the December quarter. Related video: Alibaba founder Jack Ma is laying low for the time being, but he’s not missing
