【9988 Analysis】Alibaba "Three Consecutive Gains," Earnings to be Announced Thursday; Analysts: "Aircraft Carrier-Style Business" Recovery to Half of January High Also Offers Nearly 10% Returns

Alibaba (09988) The stock has risen for the third consecutive trading day before earnings, reaching a high of 138.5 HKD today (Tuesday), with a total increase of nearly 5%. The company will release its Q3 results on Thursday. According to consensus forecasts from brokers, revenue is expected to increase by 3% year-on-year to 289.8 billion RMB. Adjusted net profit, however, is expected to decline by 42% to 29.58 billion RMB. Historically, earnings are usually announced after market close.

An analyst pointed out that the Hong Kong stock market has recently been recovering and performing well. Both Alibaba and Tencent (00700), two major weight stocks set to announce earnings this week, are worth buying at current levels. “You see, Alibaba has had a long journey, falling from 174 HKD (its January high) to 125 HKD. If it rebounds halfway, that’s a 25 HKD increase, nearly a 10% return from current levels… Alibaba’s business spans e-commerce, cloud computing, AI, and more. It covers all the cutting-edge sectors, like a carrier flagship.”

As for Tencent, she believes it is also worth paying attention to. “Tencent’s core businesses—payment services and gaming—are its cash cows. It has two main cash cows, plus new businesses and investment projects. So, the risk distribution and potential for growth are very balanced.” Regarding price trends, “The earnings forecast shows a clear upward trend, with around 500 HKD being a bargain zone. My target is 600 HKD. If the earnings ‘wake up’ and push the stock higher, there’s still about 30 to 40 HKD of upside.”

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