Earnings Preview: Baidu, Inc. (BIDU) – China’s Internet Giant Set for Impressive Quarter
By:NewsyStocks   Friday, January 27, 2022 7:42 PM

Chinese search engine Baidu.com is scheduled to release its fourth quarter results on Monday, January 30. After a tumultuous 2011, Chinese internet stocks look set to pick up again and Baidu certainly is a frontrunner.

Analyst consensus estimates for the fourth quarter point towards earnings of $0.89 per share indicating an increase of 78 percent year-over-year. Revenue this quarter is expected to come in around $700 million, flat compared to the year-ago period.

Majority of analysts are bullish on BIDU with 24 Buy ratings out of 31.

Deutsche Bank comments that traffic growth and increasing monetization should help Baidu achieve long term growth especially due to its algorithm optimization and the spending by large advertisers.

BIDU has an average target price of $185.87 indicating an upward potential of nearly 50 percent.

The company's search, video and social search are expected to provide the most traction. Baidu continues to attract advertisers and this should help boost top lines in 2012.

Furthermore, the company is expected to invest heavily in R&D as it rolls out new initiatives.

Third Quarter Results & Earnings History

Baidu's 3Q revenue grew 94 percent to $655 million. Profits also exceed Wall St. expectations at $0.86 per share.

The company has displayed strong revenue growth in all three quarters of 2011 clocking 96.3 percent in Q1, 87.1 percent in Q2, and 94 percent in Q3 year-over-year.

Our Take

Baidu enjoys a favorable position among the competitive Chinese internet industry and looks set to outperform its peers. The company should experience stronger growth as the internet space in China expands. Baidu is also looking at ways to enhance usage and stickiness along with improving its vertical content through partnerships and acquisitions.