Insiders bought $15 million worth of Alibaba stock after the crash. Should you follow their lead?

Alibaba Board Chairman Joseph Tsai and CEO Eddie Wu bought shares in the company after its stock price fell following a secondary offering to finance investments in AI, according to Bloomberg.

In total, they purchased Alibaba securities worth 120 million Hong Kong dollars ($15.3 million). Cai added shares worth approximately 81 million Hong Kong dollars to his portfolio, while Wu added shares worth 39 million Hong Kong dollars, according to the company’s disclosures. Combined, the two executives own less than 2% of Alibaba, Bloomberg notes.

The e-commerce giant’s stock price fell 8.5% at the close of trading on August 24 on the Hong Kong Stock Exchange. This came after Alibaba announced that it had raised 80 billion Hong Kong dollars ($10.2 billion) through its largest secondary share offering. The offering price was set at a 3.6% discount to the closing price of the company’s American Depositary Receipts on Friday, August 21. Demand from institutional investors was nearly three times the supply, according to Bloomberg sources.

The company—which has evolved from an online retailer into one of the market leaders in AI—needs the funds to finance the further development of artificial intelligence. Today, it ranks among the Chinese companies with the highest AI-related expenditures. In the second quarter of 2026, Alibaba’s capital expenditures rose 75% to 67.7 billion yuan, while net income plummeted 75% year-over-year. The company announced plans to invest 380 billion yuan ($56.5 billion) in AI infrastructure over the next three years, according to Reuters. However, like other AI developers, it faces pressure from investors who want proof that large-scale investments can generate profits.

Since the beginning of the year, Alibaba's stock has fallen 21%, and its American depositary receipts have lost about 18% of their value.

The average target price for the company's stock in New York is $159, which implies growth potential of one-third. Wall Street maintains a predominantly positive outlook: according to MarketWatch, 47 out of 50 analysts recommend buying Alibaba stock, and only one advises selling.

This article was AI-translated and verified by a human editor