Market Pulse50Neutral

Alibaba Group Holding LimitedOpportunity Rank #116(BABA) Intrinsic Value & DCF Analysis (2026)

Current Price

$126.08

Last updated: Mar 24, 2026

Price vs Intrinsic Value

$126.08
Price
$381.83
Intrinsic Value
Undervalued by 203%MOS: $305.46

Fundamental Score

57/100
Neutral

Weighted across 6 signals

Narrative Score

29/100
Broken

+5 vs previous

The intrinsic value of Alibaba Group Holding Limited (BABA) is estimated at $381.83 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $126.08, the stock appears undervalued relative to its projected cash flow fundamentals. This estimate assumes a 7.06% long-term growth rate and an 8.00% discount rate (calculated: 7.28%), reflecting expected future free cash flow and cost of capital.

The intrinsic value of Alibaba Group Holding Limited (BABA) is estimated at $381.83 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $126.08, the stock appears undervalued relative to its projected cash flow fundamentals. This estimate assumes a 7.06% long-term growth rate and an 8.00% discount rate (calculated: 7.28%), reflecting expected future free cash flow and cost of capital.

Valuation Details

$381.83
▲ 202.85% upside
20% margin of safety: $305.46
Years: 10Growth Rate: 7.06%
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Capital Efficiency

Average Quarterly ROIC
2.69%
Cost of Capital (estimated)8%
Value StatusUnderperforming Capital

The company is earning below its required return. This may indicate inefficient use of capital or excess cash that isn't being reinvested.

Complete historical ROIC is available with
.

Fundamental Details

57/100
NeutralWeighted across 6 signals
DCF Discount
202.8% discount to price
100
FCF Yield
12.6% trailing FCF yield
100
ROIC vs WACC
ROIC 2.7% vs WACC 8.0% (0.3x)
17
Net Debt / FCF
Net cash position
100
Buybacks
Share count growing
30
FCF CAGR (5Y)
1.8% 5Y FCF CAGR
25
Strengths: DCF Discount, FCF Yield. Concerns: ROIC vs WACC, Buybacks.

Narrative Details

29/100
Broken
+5 vs previous · +2 new driversVs 6-Month Baseline:Low (5th pct)Weighted across 6 recent drivers
Trend: Deteriorating downConfidence: 100%Updated: 1h ago
Sources: 207 (200 News · 7 Analyst)
Drivers(last 30 days)
4 earnings miss-1.1
156 news sentiment-0.9
3 upgrade headlines+0.4
Downgrade headlines-0.3
Layoffs-0.2
26 regulatory scrutiny+0.1

Investment Coach

Updated 12h ago
BUYConfidence: 50%
Thesis
Alibaba Group Holding Limited is significantly undervalued with an estimated fair value over 218% above its current price, supported by constructive fundamentals despite trailing returns relative to cost of capital. However, the company's narrative score is deteriorating, indicating potential challenges in market perception or business momentum.
Key Risk
The key risk is the deteriorating narrative score which may signal worsening investor sentiment or operational issues that could undermine valuation gains.
Signals To Watch
  • Monitor whether valuation discount remains above 10%.
  • Track ROIC vs WACC spread for sustained improvement.
  • Follow narrative trend for meaningful shifts in the score direction.
Ask the Coach - Available with
Historical Growth Rates
Free Cash Flow- - -Trend CAGR: 7.06%5 Year CAGR (Adjusted): -0.47%

Free Cash Flow (in millions)

TTM2025202420232022202120202019201820172016201520142013201220102009200820072006
$36,818$36,550$31,567$34,050$28,025$38,558$33,683$29,165$21,246$14,526$10,006$7,221$4,789$2,563$1,657$1,657$385$269$225$120

How Intrinziq Estimates Fair Value

Intrinziq estimates Alibaba Group Holding Limited's intrinsic value using a discounted cash flow (DCF) model based on free cash flow trends and a market-based discount rate. The model projects future cash flows over ten years and discounts them using a market return assumption to estimate fair value.

Alibaba Group Holding LimitedConsumer Cyclical

Alibaba Group Holding Limited, through its subsidiaries, provides technology infrastructure and marketing reach to help merchants, brands, retailers, and other businesses to engage with their users and customers in the People's Republic of China and internationally. The company operates through seven segments: China Commerce, International Commerce, Local Consumer Services, Cainiao, Cloud, Digital Media and Entertainment, and Innovation Initiatives and Others. It operates Taobao and Tmall, which are digital retail platforms; Alimama, a proprietary monetization platform; 1688.com and Alibaba.com, which are online wholesale marketplaces; AliExpress, a retail marketplace; Lazada, Trendyol, and Daraz that are e-commerce platforms; Freshippo, a retail platform for groceries and fresh goods; and Tmall Global, an import e-commerce platform. The company also operates Cainiao Network logistic services platform; Ele.me, an on-demand delivery and local services platform; Koubei, a restaurant and local services guide platform; and Fliggy, an online travel platform. In addition, it offers pay-for-performance, in-feed, and display marketing services; and Taobao Ad Network and Exchange, a real-time online bidding marketing exchange. Further, the company provides elastic computing, storage, network, security, database, big data, and IoT services; and hardware, software license, software installation, and application development and maintenance services. Additionally, it operates Youku, an online video platform; Quark, a platform for information search, storage, and consumption; Alibaba Pictures and other content platforms that provide online videos, films, live events, news feeds, literature, music, and others; Amap, a mobile digital map, navigation, and real-time traffic information app; DingTalk, a business efficiency mobile app; Tmall Genie smart speaker; and Qwen, an artificial intelligence chatbot. The company was incorporated in 1999 and is based in Hangzhou, the People's Republic of China.