Alibaba surprise revenue miss sent shares plunging on Thursday, but some investors say their enthusiasm for the Chinese e-commerce giant has not cooled, given its long-term potential.

"I don't think it's even a stumbling block," said Mark Yusko, head of the $4 billion Morgan Creek Capital Management.

Alibaba Group Holding Ltd shares fell 8.8 percent on Thursday to close at $89.81, sending the stock below its Sept. 19 first-day opening price of $92.70, after the company reported lower-than-expected revenue.

The company's record $25 billion initial public offering was met with great fanfare, attracting big purchases from hedge funds managers eager for exposure to a company frequently referred to as the "Amazon of China." Shares soared, hitting a high of $120 in November, but the stock has slumped since, losing 25 percent of its value.

Despite the revenue miss and a migration of customers to mobile devices, where margins are typically narrower, investors said the stock remains attractive as a long-term play on China's burgeoning consumer market.

"We're in this for the long term. We think this is going to be a dominant franchise," said Yusko.

Yusko started buying shares of Alibaba through private purchases well before the company's offering last September, and has added to that position over time.

Hedge funds owned about 4 percent of Alibaba's equity - or nearly 100 million shares - as of Sept 30, with 27 different funds counting it among their top 10 holdings, according to Goldman Sachs data analyzing hedge fund filings.

But the stock's strong debut last year - as well as gains in the four months since - may have set expectations too high, said Vince Rivers, senior portfolio manager at JO Hambro Capital Management for the small/mid-cap US equity strategy.

"It's not cheap," he said. "At a relatively high valuation, you're going to get this kind of reaction."

Alibaba's forward price-to-earnings ratio fell to 29.7 on Thursday from 32.6 with the stock's decline, though that valuation makes it still more expensive than auctions site eBay Inc or Chinese rival Baidu Inc.