HSBC Slashes Price Targets On Alibaba, Baidu Due to China's Covid Surge, Regulatory Crackdown

  • HSBC analyst Charlene Liu cut the price target on Baidu Inc BIDU to $180 from $195 (31.3% upside) and kept a Buy rating on the shares. 
  • The analyst now assumes a worse impact from COVID-19 on the company's core ad and cloud businesses and margins, seeing a recovery only in Q4.
  • Liu reduced the price target on Alibaba Group Holding Ltd BABA from $168 to $156 (49.3% upside) and maintained a Buy.
  • Also Read: Here's Why Alibaba's Stock Didn't Get a Boost Despite Big Share Buyback
  • China just cracked down upon abuse of algorithms by internet giants and questioned Alibaba and others over their job cuts.
  • Benchmark and Citi analysts also slashed their price targets on Alibaba to reflect China's Covid induced disruption.
  • The dwindling fortunes of the Chinese tech shares recently prompted concerns over the Alibaba stake selloff by SoftBank Group Corp SFTBY SFTBF.
  • Price Action: BABA shares traded higher by 0.74% at $105.04 on the last check Friday.
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