Morgan Stanley upgraded Alibaba (BABA) to its top pick, replacing Tencent in the top spot. The investment bank cited Alibaba's commanding position across the full artificial intelligence stack as the primary reason for the shift.
Analysts believe Alibaba’s structural advantage stems from its self-developed chips and top-ranked cloud infrastructure in China. The company’s vertical integration also includes widely adopted AI models and various consumer-facing applications.
This comprehensive in-house capability serves as a key differentiator in the global AI race. Morgan Stanley suggests these factors help the company mitigate existing competitive and regulatory risks.
The upgrade arrives ahead of Alibaba's third-quarter earnings report. The company will release these financial results on March 19.