Last week, Baidu added a video search function to its
Japanese search engine, along with a feature to limit
the search to websites such as YouTube or MySpace.
Baidu has also launched a brand new online customer
support center at support.baidu.com, and published
a report on China's online game industry for H1, 09.
Players use the search engine as their #1 resource for
information on online games.
Monday, July 27, 2009
Analyst reaction: CS, Nomura, Pac Crest,, S&P
CS reiterates underperform, and symbolically lowers PT
from $250 to $248.
Nomura reiterates neutral rating.
China’s $585 billion stimulus package is bolstering Baidu’s
earnings as companies buy ads to sell products needed for
road, bridge and other projects funded by the government,
said Jin Yoon, an analyst at Nomura Holdings Inc. The
economy grew 7.9 percent in the second quarter after
expanding 6.1 percent in the first amid simultaneous
recessions in Europe, Japan and the U.S. “The worst is behind
us,” said Hong Kong-based Yoon. “The second half of this year
will be strong for Baidu.”
"The new bidding system should lead to more targeted results
and higher revenue over time," Steve Weinstein, an analyst
from Pacific Crest Securities said in a note. PT at $410.
S&P reiterates "Strong Sell".
from $250 to $248.
Nomura reiterates neutral rating.
China’s $585 billion stimulus package is bolstering Baidu’s
earnings as companies buy ads to sell products needed for
road, bridge and other projects funded by the government,
said Jin Yoon, an analyst at Nomura Holdings Inc. The
economy grew 7.9 percent in the second quarter after
expanding 6.1 percent in the first amid simultaneous
recessions in Europe, Japan and the U.S. “The worst is behind
us,” said Hong Kong-based Yoon. “The second half of this year
will be strong for Baidu.”
"The new bidding system should lead to more targeted results
and higher revenue over time," Steve Weinstein, an analyst
from Pacific Crest Securities said in a note. PT at $410.
S&P reiterates "Strong Sell".
Friday, July 24, 2009
Analyst reaction: DB, CLSA, SIG
Deutsche Bank said Baidu is an "excellent margin story"
and said the transition to new ad system Phoenix Nest
was faster than expected. They reiterated their Buy
rating and $374 price target. They also noted Baidu's
search traffic share seems to have steadily increased
since March end.
CLSA lifted its price target today to a 'Street High' $430,
reiterating their Buy rating.
Susquehanna said large advertisers, margin expansion
led to better EPS. The firm raised their price target to $380,
reiterating their Positive rating.
and said the transition to new ad system Phoenix Nest
was faster than expected. They reiterated their Buy
rating and $374 price target. They also noted Baidu's
search traffic share seems to have steadily increased
since March end.
CLSA lifted its price target today to a 'Street High' $430,
reiterating their Buy rating.
Susquehanna said large advertisers, margin expansion
led to better EPS. The firm raised their price target to $380,
reiterating their Positive rating.
Analyst reaction: Piper Jaffray
Piper Jaffray said the results were strong and the
company's less conservative guidance for Q3 is a
sign that the overall advertising environment has
improved in China. The firm noted operating
margin improved significantly in Q209 to 38.5%,
vs. 34.4% in Q208 and 24.5% in Q109. The firm
raised their price target from $340 to $363,
although they maintained their Neutral rating.
company's less conservative guidance for Q3 is a
sign that the overall advertising environment has
improved in China. The firm noted operating
margin improved significantly in Q209 to 38.5%,
vs. 34.4% in Q208 and 24.5% in Q109. The firm
raised their price target from $340 to $363,
although they maintained their Neutral rating.
Analyst reaction: Goldman Sachs raises PT to $376
Goldman Sachs said Baidu's Q2 results exceeded
their revenue and margin forecasts. Goldman said
they were surprised that TAC climbed to 17% of
revenues, but said BIDU still beat on margins.
The analyst raised his price target on Baidu from
$350 to $376, maintaining the top Conviction Buy
List rating on the shares.
their revenue and margin forecasts. Goldman said
they were surprised that TAC climbed to 17% of
revenues, but said BIDU still beat on margins.
The analyst raised his price target on Baidu from
$350 to $376, maintaining the top Conviction Buy
List rating on the shares.
Analyst reaction: Citi raises PT to $385
Business largely back to normal - Baidu's strong
Q2 QoQ growth and Q3 guidance suggest that
the impact of the CCTV expose is largely over, and
the core business is back on track. With Baidu
adding sales headcount, Phoenix Nest set to improve
relevancy and monetization, and ARPU likely
to increase with the improving economy, the outlook
for the next 12 months is bright. While traffic
acquisition costs (TAC) likely will increase further, we
believe Baidu can moderate spend elsewhere (e.g.,
Japan, marketing, etc.) to protect OpM and hence
earnings. We maintain Buy and raise our TP to
US$385 (30x 2010E P/E), from US$260, as we roll
our valuation forward to a 2010 base.
[Citi now has an EPS estimate of $10.28 for 2010]
Q2 QoQ growth and Q3 guidance suggest that
the impact of the CCTV expose is largely over, and
the core business is back on track. With Baidu
adding sales headcount, Phoenix Nest set to improve
relevancy and monetization, and ARPU likely
to increase with the improving economy, the outlook
for the next 12 months is bright. While traffic
acquisition costs (TAC) likely will increase further, we
believe Baidu can moderate spend elsewhere (e.g.,
Japan, marketing, etc.) to protect OpM and hence
earnings. We maintain Buy and raise our TP to
US$385 (30x 2010E P/E), from US$260, as we roll
our valuation forward to a 2010 base.
[Citi now has an EPS estimate of $10.28 for 2010]
Analyst reaction: RBC
Baidu.com: Color on qtr (332.64)
RBC notes although BIDU's 3Q09 guidance
(reported last night after the close)
was shy of the highest expectations, firm
notes that 15-18% sequential growth
is still very impressive all things considered.
The high-end of guidance is in-line with firm's
est, and it will move consensus ests higher. If
there was one blemish on the reported qtr, it
is the continued increase in TAC payments
as traffic from the Union continues to outgrow
that of Baidu O&O. Mgmt noted the absence of
the summer Olympics as a factor in the
improvement in sequential growth vs. the prior yr,
though RBC believes the stabilization in the macro
environment is also helping Baidu return to more
normal seasonal growth trends seen in years prior
to 2008. 2Q09 was yet another uneventful qtr
with no thesis-changing data points, and as such
maintains Outperform rating. Tgt rasied to $339
from $331.
RBC notes although BIDU's 3Q09 guidance
(reported last night after the close)
was shy of the highest expectations, firm
notes that 15-18% sequential growth
is still very impressive all things considered.
The high-end of guidance is in-line with firm's
est, and it will move consensus ests higher. If
there was one blemish on the reported qtr, it
is the continued increase in TAC payments
as traffic from the Union continues to outgrow
that of Baidu O&O. Mgmt noted the absence of
the summer Olympics as a factor in the
improvement in sequential growth vs. the prior yr,
though RBC believes the stabilization in the macro
environment is also helping Baidu return to more
normal seasonal growth trends seen in years prior
to 2008. 2Q09 was yet another uneventful qtr
with no thesis-changing data points, and as such
maintains Outperform rating. Tgt rasied to $339
from $331.
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