Alibaba is not a cheap Amazon, and cheap can stay cheap for a long time. It trades at 2015 prices, while since 2015 Amazon has gone from $34 to $250, Alphabet from $39 to $344 and QQQ from $100 to about $770, eleven years of missed compounding. Chinese companies should not be assumed to follow the playbook of American tech giants, just as Tencent is not Alphabet and BYD is not Tesla. x.com 

Alibaba is no longer worth owning when better opportunities exist. The case for it as a China hedge was a macro feeling applied to a single company, and it ignored Jack Ma being yanked away and a lack of cloud growth while leaning on share buybacks and looking too cheap to ignore. Despite its discount to US companies, other stocks, such as GitLab and Airbnb, now look much more compelling. x.com 

Alibaba is a contrarian trade because accelerating demand for relatively cheaper compute is very underappreciated, and China's cloud market is still in its infancy versus the US. Alibaba is a consensus short as upside from closed-source AI looks illusory. x.com  x.com 

Anthropic's accusation that Alibaba's Qwen lab distilled its frontier models is optically bearish for Alibaba, though no penalties have been enforced. Per Anthropic, the lab used thousands of fake accounts and over 28.8 million exchanges. While penalties are absent, the rewards outweigh the risks for Alibaba if distillation lifts Qwen's market share, as many US AI startups already use Qwen for its cost-effectiveness versus Gemini and others. x.com  x.com 

Alibaba's $10.2 billion Hong Kong share placement shows its cash burn has caught up with it, and more dilution is likely. Core China ecommerce makes roughly $30 billion of flat EBIT, half of it reinvested in quick commerce to defend share against PDD. Cloud and AI earns $2 billion of EBIT growing 35% but burns about $10 billion a year in AI-model opex. Pro forma EBIT of about $7 billion collapses after $20-25 billion of annual capex, so Alibaba will keep tapping equity markets. x.com 

Alibaba's market cap is only about 10x the next 12 months' sales of its cloud business, so the e-commerce behemoth comes for free. The cloud business now has a $24 billion revenue run rate, growing 38% year over year and still accelerating, and it is early days in China. A post the author replies to counters that Alibaba Cloud's margins are only 3-5% versus AWS's 30%, but Google Cloud's margins three to four years ago versus today show how that can change. x.com  x.com 

Alibaba is tough to hold because it is splitting investment between e-commerce and AI, creating massive execution risk. AI is so capex-hungry that, as Western examples show, Alibaba cannot spread spending and still reach comparable results. The market sees China e-commerce spending, including the quick-commerce race, as having no ROI, and is right. Replies argue Alibaba has no choice; it might still make it, but the risk is that its AI push slows. x.com  x.com  x.com 

Alibaba's new paradigm is issuing shares, which makes the stock unattractive unless it falls by half from here. The latest example is an HK$80B ($10.2B) share placement to fund its full-stack AI capabilities. x.com 

Alibaba at $110 is one of the most mispriced mega-caps because investors effectively get its AI and cloud business for free. The company is worth about $270B and holds around $70B in cash and liquid investments, while core e-commerce generated almost $5.9B of adjusted EBITA in one quarter, roughly $230B annualized at just 10x. AI and cloud may be Alibaba's most valuable part five years from now. x.com 

Amazon's weak retail growth has shaken the earlier buy case. Online-store sales rose just 2% year over year, and the retail numbers look so poor that it is no longer clear at what price the shares are a buy. x.com  x.com  x.com