A Tale of Two Markets: Divergent Investor Strategies Shape Alibaba’s Path

Alibaba Group finds itself at the center of a striking investment dichotomy. As institutional investors in the United States scale back their holdings, significant capital is simultaneously flowing into the Chinese e-commerce giant's shares through Hong Kong trading channels. The stock, currently trading around $150, reflects this tension between conflicting market signals.

On the operational front, Alibaba is advancing two key strategic areas. The company is aggressively pursuing artificial intelligence integration and has expressed concrete interest in Nvidia's H200 chips. Securing U.S. export licenses for these high-performance components could provide substantial momentum to its cloud computing division.

Concurrently, its logistics subsidiary Cainiao, in partnership with Tmall, is expanding its warehouse network. This move aims to guarantee faster delivery times within the fiercely competitive instant commerce sector and to defend market share against domestic rivals.

Asian Capital Inflows Counter Western Retreat

The contrast in investor behavior is geographically clear. On December 19, 2025, Alibaba recorded a net inflow of HKD 1.05 billion via the Southbound Stock Connect scheme. This made it the second-most purchased stock through that channel after Tencent, significantly outperforming competitors like China Mobile, which actually experienced net outflows.

This activity suggests Asian investors currently find Alibaba's valuation considerably more attractive than their Western counterparts do.

Should investors sell immediately? Or is it worth buying Alibaba?

U.S. Institutional Investors Pull Back

A retreat is underway among Western asset managers. Corient Private Wealth LLC sold nearly 5,000 shares in the second quarter of 2025, reducing its position by 11.9%. Its remaining holding consists of 36,607 shares valued at approximately $4.16 million.

Such transactions typically indicate portfolio rebalancing or risk diversification, a common pattern observed with U.S. fund managers navigating their exposure to Chinese technology equities.

Analyst Sentiment and Market Context

Market experts maintain a generally constructive outlook. The consensus price target among analysts stands at $194, supported by 17 "buy" recommendations, two "hold" ratings, and a single "sell" advisory.

Alibaba's shares trade well above their 52-week low of $80 but remain below the yearly peak of $193. With a market capitalization of roughly $357 billion, the stock's current trajectory is being shaped by the pronounced divergence between institutional selling in the West and aggressive buying in the East.