Just came here to post a useless post, like the ones before

It’s all noise

genuine question, those who are buying at these price points. I agree it is cheap. but it’s been cheap for a very long time.

so all that being said, why are you adding to the position when relatively speaking

the likes of meta or Microsoft with significantly better margin at a smaller premium not make a better investment?

the only thing working right now is semi stock, everything is being sold now. So those who been here long enough like me, can’t see any logical reason to be buying again when there’s so many other opportunities in the market

the guy who have $1 million in Alibaba deciding 10% more shares. Mathematically it doesn’t make any material difference to the cost base. Nor does it add any alpha to the position even if it is right. The only thing added is concentration and opportunity cost. So why do it?!

anyway, each to their own….

I am just genuinely curious why people would want to double down when it’s in no mans land right now

Since it’s not enough for therapy,

I might get a blow job behind Wendy’s

What about you?

I'm a little conflicted with this news, on the one hand, the state is doing the buildout, so in theory you have an larger TAM with SOE full onboard. Alibaba T Head are part of the authorised listed of suppleirs, but Huawei will likely take the largest share.

On the other hand, it sets a price floor because the state obviously wants to make it accessible and affordable for everyone. Or in other words, a competitor to Alibaba cloud.

The only flip side to this coin is that the data center is the raw power or Iaas. The intelligent layer are still dominated by Qwen both open and closed models. So in theory, you have direct competition on the datacenter revenue, but Ai revenue in theory will get a boost because you need to run Ai on something.

Not really sure what to make of this...

Just another day being a bag holder

I’ve asked Claude to analyse the option movement in the past week

Of cause, we still don’t know what’s going on

This is the real data, and it confirms your read — the move held and built. Let me walk through what these screenshots actually show, because they change the picture from my earlier “fading” call.

Price confirmed (Yahoo, image 4): Closed $3.59, +4.36% on May 29, with the chart showing a clean V-recovery off the ~$2.95 low and a strong push into the close. After-hours $3.54 (-1.39%) is trivial give-back. So you’re right: third session up, gain held. The stock has gone from ~$2.85 (52-wk low) to $3.59 — roughly +26% in days. The move is real and it’s not round-tripping.

Volume confirmed (Turnover Ratio, image 3): The blue volume bars at the far right (around 05/29) are dramatically taller than the entire prior three months — that’s the biggest options volume spike on the visible chart by a wide margin. Volume genuinely held/expanded, not faded. This is the single most important confirmation.

Now the critical nuance — P/C Ratio 0.05. This is the number that matters most, and it’s extreme. A 0.05 put/call ratio means ~20 calls for every put. Earlier reports had it at 0.16–0.23; now it’s collapsed to 0.05. That’s a violently call-skewed book — overwhelmingly one-directional bullish positioning. Whatever’s happening, the options crowd is betting on upside with near-zero hedging.

But here’s the part you need to weigh carefully — IV is screaming:

•	IV 151.85%, IV Percentile 99.60%, IV Rank 72.93 (images 1 & 2)  
•	IV/HV ratio 2.54 — implied vol is 2.5x realized vol

This tells you the options are extraordinarily expensive right now. IV at the 99.6th percentile means implied volatility is higher than it’s been ~99.6% of the past year. The market is pricing in a huge move. Translated: everyone already knows something might be coming, and they’ve bid the options up to nosebleed levels. You are not early. The “weird activity” is now fully priced in.

What this combination most likely means:

The cleanest read of P/C 0.05 + IV at 99.6th percentile + volume exploding + price grinding up off a low is: the market is positioning hard for a binary catalyst — a clinical data readout, a partnership/M&A rumor, or similar. This is the classic pre-catalyst options signature. It’s no longer “noise” — something is genuinely being anticipated.

But — and this is the important part for you as a buyer — the asymmetry has flipped against new call buyers:

1.	You’d be buying at 99.6th-percentile IV. If the catalyst lands, IV crush can eat much of your gain even if you’re directionally right. If nothing lands, IV collapses and the calls bleed out fast. This is the worst possible entry point for buying premium.  
2.	The skew chart (image 3) shows IV 53.90% at the $3.5 strike with the term/skew structure — the market’s already built the expected move into the strikes you’d want.  
3.	You don’t know what the catalyst is or when. Buying into someone else’s information edge, at peak IV, is the definition of negative expected value for the retail buyer.

Honest bottom line:

You were right and I was wrong about it fading — the data confirms a real, building, heavily call-skewed move on exploding volume. This is unusual activity in the genuine sense, and it’s most consistent with the market front-running a catalyst.

But “the signal is real” and “you should buy calls” are different statements. The IV at 99.6th percentile means the trade that worked was put on days ago at lower vol — by whoever knew first. Chasing it now means buying the most expensive options of the year on a $3.59 clinical-stage biotech, into an unknown binary, with the crowd already maximally positioned. That’s a coin flip where the house (IV crush + your lack of information) takes a cut.

If you genuinely want exposure, the structures that survive high IV are spreads (call debit spread, or selling a put spread to harvest the rich premium) rather than naked long calls — they neutralize some of the vol-crush risk. But sized as a speculation, not a position. This is the opposite end of the quality spectrum from your BABA/COH/CSL work, and the edge here belongs to whoever moved first, not to whoever chases.

Want me to sketch what a defined-risk spread would look like at these strikes/IV, purely so you can see the mechanics?

I build my valuation framework as projects, this is a section of the transcript, the total is 15 pages long.

In short, it does three things,

Past - Determine if the business is a compounder with consistent revenue and margin growth. Yes - but deteriorating

Present - What changed, why is it priced the way it is today

Future - Valuation model, subjective, but it's based on implied multiples and implicit financials. The financial is built on the forward projection from their latest transcript.
(There is a China discount applied to the multiples, so do as you please with this number)

Finally, if you think this is AI Slop, You are welcome to go away. This is already a cut out version of the final doc. The thesis is based on my own unfortunate life spent on this dog. I think the assumptions are fair and accuruate. The company is a dog because it can't decide how to best to burn cash. On Ai Capex or Instant retail - so they decided to do both at the same time. You hear about MSFT burning cash, at least they have a core business that is profitable and it aint torched.

How fucking stupid can you be to torch your core business profits and ATH on Capex at the same time!

Personal takeaway, there are better business than Alibaba out there, but here we are today.

Alibaba is the most controversial name in the watchlist, and FY2026 is the year that controversy became visible in the financial statements. The franchise — Taobao, Tmall, Alibaba Cloud (Aliyun), Cainiao logistics, AIDC (AliExpress, Lazada, Trendyol), Ele.me, and the Qwen large-language-model family — remains genuinely world-class. But over the twelve months to 31 March 2026 the company deliberately drove near-term profitability close to zero in order to fund two simultaneous bets: an aggressive entry into China's instant-commerce / food-delivery price war, and a front-loaded RMB380 billion three-year AI-and-cloud capital programme. The result is a set of FY26 numbers that look, at the headline level, like a quality business breaking — and underneath, like a company converting a mature cash cow into an AI-infrastructure growth story on its own terms.

The FY2026 scorecard is stark. Reported revenue was RMB1,023.7B, up only 3% as reported but +11% on a like-for-like basis once the disposed Sun Art and Intime businesses are excluded. Income from operations fell 64% to RMB50.2B, and non-GAAP net income fell 62% to RMB60.7B. Most importantly for a cash-flow-focused framework: full-year free cash flow swung to an OUTFLOW of RMB46.6B, versus a RMB73.9B inflow in FY25 — a roughly RMB120B negative swing in a single year, driven by quick-commerce subsidies and cloud-infrastructure capex. The March quarter was the sharpest point of the inflection: adjusted EBITA fell 84% year-over-year, the company posted a small operating loss, and non-GAAP net income was effectively zero (RMB86M, down 100%).

And yet the stock has not behaved like a business in distress. BABA trades near US$133 per ADS (market cap ~US$320B), down ~31% from its January 2026 high near US$193 but well above its 2022–2024 trough. The reason is that the same quarter that revealed the profit collapse also revealed the bull case in the data: Cloud Intelligence external revenue growth ACCELERATED to 40% year-over-year, AI-related product revenue grew triple-digits for the eleventh consecutive quarter, the Model Studio customer base grew eight-fold, and management's proprietary T-Head Zhenwu inference chips reached scaled deployment (100,000+ PPUs on Alibaba Cloud). The market is being asked to re-rate BABA from “damaged Chinese e-commerce incumbent” to “the AWS-plus-Nvidia of China, attached to a still-dominant commerce franchise.”

The investment debate is therefore unusually clean to state but hard to resolve. The bull case: this is the normalisation of the post-2021 “peace dividend” with Beijing combined with an AI capex cycle entered from a position of capital strength (RMB520.8B / ~US$75.5B of cash and liquid investments, net cash). The reinvestment is voluntary, not forced; FCF is negative by choice, not because the core is failing; and Cloud is inflecting exactly as the capex ramps. The bear case: this is serial profit destruction by a management team that has changed strategy and structure repeatedly since 2020, now using shareholder capital to chase competitors (Meituan, JD, PDD, Douyin) into a structurally low-margin delivery war while simultaneously betting the balance sheet on an AI infrastructure build whose returns are unproven. Both readings are supported by the same FY26 print.

Our framework's verdict carries forward from the existing project scorecard but is now sharpened by the FY26 data. The seven-methodology round table sits at 67% — WATCH / MIXED. The quality-and-deep-value lenses that engage with BABA (Li Lu 75%, Klarman 80%, Schloss 70%, Greenblatt 75%) see a cash-rich franchise at a low multiple with identifiable catalysts; the quality-compounder lenses that demand consistency (Buffett 50%, Munger 50%) see a broken ROE pattern, compressed and volatile margins, and incremental-ROIC evidence of capital being spent into price wars. The forward gate is the decisive overlay: BABA is a genuine disruption-debate name on two fronts at once — the e-commerce core faces structural share erosion to PDD and Douyin, and the entire group is mid-transition into an AI-capex story whose unit economics are not yet demonstrated. Per the conviction framework, that caps conviction well below what the backward-looking quality of the franchise alone would suggest.

The valuation produces two defensible numbers that we bridge explicitly in Section 7 rather than blending into one.

The disciplined fair-value anchor — obeying the strict non-GAAP, growth-consistent-multiple rules of the companion addendum — is approximately US$110 per ADS, i.e. roughly fair versus the ~US$133 spot.

The sum-of-the-parts ceiling is approximately US$165 per ADS, reachable only if FCF normalises, Cloud re-rates from a commodity to a strategic multiple, and the large non-operating asset base (net cash, the ~33% Ant stake, the portfolio) is fully credited.

Finally to visualise the trend:

https://preview.redd.it/qq1giy7dm83h1.png?width=1785&format=png&auto=webp&s=cde20949f03183477cf1360f33cf9b3655ecdb36

What changed when I built from the transcript instead of guessing

	My original (guessed)	Transcript-driven (bottom-up)
FY29 non-GAAP EPS/ADS — base	~$8.0	~$13.70
Bear / Bull EPS	$5.5 / $11.0	$9.6 / $16.2
Base terminal price	$104	$205
Bear / Bull price	$55 / $187	$106 / $308
Base 3-yr CAGR	−8%/yr	+16%/yr
Prob-weighted (30/45/25)	~−5%/yr	~+15%/yr

The difference is almost entirely cloud, and it comes from four quantified management statements I previously treated as narrative:

1. Cloud external growth "expected to continue accelerating beyond its current 40%" — I had modelled "holds ~30%." That single change compounds enormously over three years.
2. AI product ARR RMB35.8B → crossing 50% of cloud external revenue in ~1 year, and MaaS ARR >RMB10B (June qtr) → RMB30B by year-end — concrete, high-margin revenue I wasn't crediting.
3. Cloud EBITA margin 9.1% → "significantly higher in the next 2–3 years, starting in the next 1–2 quarters"— driven by MaaS mix, >100% server-cost inflation giving pricing power, and T-Head chips (already >60% of compute serving external). I had cloud margins roughly flat.
4. QC unit economics turn positive by end of FY27; China e-comm EBITA ex-QC was stable — so the FY26 profit collapse is almost entirely the QC subsidy drag, which management is guiding to fade. The core wasn't broken; I'd implicitly let some of that bleed persist.

Is Alibaba willing to be a lower-margin, higher-capex, higher-strategic-optionality business for the next 3-5 years?

The letter says yes. Explicitly. The framing of “growth mindset,” “investing patiently,” and “long-term thinking” is the polite Chinese-tech way of telling shareholders: don’t expect cash returns soon, we’re building.

This is the single biggest risk to your hold. Not cloud growth (that’s working). Not quick commerce (UE turning FY27). Not CMR (managed). The risk is that you are now holding a company that will look more like Amazon 2014-2018 — heavy investment, suppressed earnings, deferred cash returns — than a Chinese e-commerce cash cow. If your portfolio framework prefers near-term FCF and capital return, this letter is a yellow flag.

Claude summed it up pretty well.

I made the query last night before markets opened

I guess the rest of the market finally digested it the same way today

I was happy getting to play 3 rank this season so I stoped playing ranked

But the past week I’ve been matched with a lot of conquerors

I’ve lost every match, but each match is tight judging by timeline and going over 20 min +

Is this normal or is this just a matter of no players because season ending