The Zhitong Finance App learned that J.P. Morgan Chase released a research report stating that it gave Alibaba-SW (09988) an “increase” rating. Given that the interest rate on US 10-year treasury bonds is 4.5%, it is believed that the outlook for high shareholders' returns supports Ali's stock price, and the target price was reduced from HK$105 to HK$100.

The company's profit growth for the third fiscal quarter of fiscal year 2024 ended at the end of December last year was weak, reflecting the new strategic performance of focusing on core business and not emphasizing or monetizing non-core businesses. As Ali continues to implement the new strategy, the financial outlook for the next few quarters is expected to remain sluggish, and similar weak profit growth is expected to continue. In addition, Ali announced an increase of 25 billion US dollars in the share repurchase plan. Clear shareholder earnings prospects will protect the stock price decline.

The bank expects that Ali will return approximately US$12 billion to shareholders in the 2024 fiscal year, of which about 80% will be repurchases and 20% will be dividends. After expanding the scale of repurchases, Ali will have 35.3 billion US dollars available in the stock repurchase plan for the next three fiscal years, with an average repurchase of 11.8 billion US dollars per fiscal year. Assuming that Alibaba's total annual dividends will stabilize at 2.5 billion US dollars for the next three fiscal years, based on current market capitalization, the annual return on Alibaba shareholders will reach 7%.