JPMorgan Chase & Co and Morgan Stanley analysts cut their price target for Alibaba Group Holding LimitedBABA, turning more pessimistic about the Chinese e-commerce giant on sales concerns.
Alibaba’s sales outlook for the September quarter is eroding on soft China consumption, Bloomberg reports citing analysts.
JPMorgan cut its price target for Alibaba to $135 from $145, citing a weakening revenue outlook in the near term that could continue to weigh on the share price despite an unchanged, or even potentially better, profit outlook.
JPMorgan believed sentiment-driven fund flow is the current key share price driver and revenue recovery is the critical determinant of market sentiment.
Morgan Stanley also cut Alibaba’s share price to $110 from $140, citing weak consumption and soft merchant sentiment.
JPMorgan said macro headwinds in China might limit improvement in Alibaba’s core sales, given the low visibility of a recovery in consumer sentiment and COVID policy relaxation.
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