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WSJ: Some China AI Tech Stocks Look Cheap Versus U.S., Citing Alibaba

June 15, 2026 at 08:47 EDT

Finance
Sales & Business
Foundation Models

As the AI boom drives up tech-company valuations across U.S. and Asian markets, Chinese AI-related stocks are said to remain relatively cheap. Hangzhou-based Alibaba Group Holding and peers trade at lower forward-earnings multiples than their U.S. counterparts.

AI Equities · Valuation Divide

A Place Where AI Stocks Are Still Cheap: China

The generative-AI boom has swollen U.S. tech valuations into the trillions — yet Chinese names like Alibaba and Baidu trade at a fraction of their U.S. peers, weighed down by a priced-in geopolitical risk premium.

~25%

China AI valuations vs U.S. peers — about one-quarter

$45B

DeepSeek funding-round valuation

$500B

OpenAI valuation — ~11× DeepSeek

Forward P/E — the gap drawn to scale

Taller column = more expensive. Each block ≈ 5× forward earnings.

~11×

Alibaba

~8–9×

Baidu

30×+

U.S. majors
(e.g. Amazon)

The Bull Case

Deep discount seen as a value-investing opportunity
Lower R&D costs favor Chinese players
Baidu's AI cloud revenue up double digits; Ernie API calls surging

The Caution

U.S.–China decoupling, export controls & tighter regulation
High volatility and slower AI monetization than the U.S.
Economic slowdown and weak advertising pressure earnings

The open question: whether to read the discount as untapped growth potential or to steer clear over geopolitical risk — a call that hinges on coming earnings and the course of U.S.–China relations.

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