Baidu (BIDU): the only company on Earth kicking Google’s butt. February 19, 2007Posted by deminvest in BIDU Baidu, goog, growth stock, Internet stocks, investment, nasdaq, Nasdaq stock, stock I own, stocks.
1) Because Baidu is cool. It is the Chinese Google. It is actually the only company on earth that is somehow kicking Google’s butt.
2) Because Bidu is the most successful Chinese Internet Company. Growing fast: Qtrly Revenue Growth (yoy):111%, Qtrly Earnings Growth (yoy):400%.
3) Because baidu.com has the same business model of Google. BIDU is actually gaining Chinese market share from Google. China daily: “market share of Baidu rose from 51 percent in August 2005 to 62 percent in Beijing, Shanghai and Guangzhou, the three largest cities in China, while that of Google fell to 24 percent from 33 percent ”
4) Because Baidu has a relatively low Market Capitalization. I could buy the whole company for about USD 3.54 Billion (if I had the money). Considering that Ebay bought Skype for about the same ammount and Google got Utube for about haft of that figure, I think BIDU could be a target for them…
5) Bidu has still great room to grow revenues. It has very small revenue (108.04M) for the main search engine of the second largest Internet market in the world (. This revenue can grow very much as Chinese advertisers start investing more to gain Chinese customers who are become more affluent.
6) My friend at stockpix tells me it may be a good time to buy Baidu from technical analysis point of view: http://stoxpix.blogspot.com/2007/02/bidu-chart.html
But there also a coupple fo good reasons not to get involved with our BIDU – Baidu friend:
1) BIDU has expensive P/E: Trailing P/E:93.22, Forward P/E (full year ending 31-Dec-08) :36.51
2) BIDU is expanding to Japan. It is not nice that a company growing very fast in the fastest growing Internet market, is looking abroad. Could that mean they don’t expect their China business to grow fast enough? Strange…