U.S.-listed Alibaba Group Holding (BABA) shares are trading notably higher Thursday after the Chinese e-commerce giant released over 100 open-source artificial intelligence (AI) models and a new text-to-video tool, according to media reports. At last check, BABA stock was up around 4%.
The new AI models, dubbed Qwen 2.5, are designed for use in a wide range of applications and sectors, and have more advanced capabilities in math and coding, according to CNBC. The text-to-video tool is based on Alibaba's AI models, allowing users to input a prompt and have a video created.
"Alibaba Cloud is investing, with unprecedented intensity, in the research and development of AI technology and the building of its global infrastructure," said Alibaba CEO Eddie Wu in a keynote address at the company's annual Apsara Conference.
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Wu added that Alibaba is "rebuilding future-oriented advanced AI infrastructure from chips, servers, networks, storage, to cooling, power supply, and data centers."
The executive concluded his speech by saying we are "standing at the dawn of the AI era" and he is "truly excited."
Is Alibaba stock a buy, sell or hold?
Alibaba had a rough start to 2024, but shares have been trending higher over the past month or so, and are up more than 22% since late June. And Wall Street remains very bullish on the Chinese consumer discretionary stock.
According to S&P Global Market Intelligence, the consensus recommendation among the analysts following the stock that it tracks is a Strong Buy.
Financial services firm Jefferies is one of those with a Buy rating on BABA stock, alongside a $116 price target.
"Alibaba has multiple growth drivers in the years ahead, in our view, with its core marketplace a strong cash cow that enjoys secular growth momentum amid consumption upgrade in China, thanks to solid execution and technological strength in digitalizing the retail sector with enhanced efficiencies," says Jefferies analyst Thomas Chong.
He adds that BABA’s cloud computing unit has "clear market leadership as the backbone of digitalization across different industries."
Jefferies' $116 price target represents implied upside of roughly 32% to current levels.
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