Baidu Inc. (BIDU) wins but lags in the market: what you need to know
IIn the last trading session, Baidu Inc. (BIDU) closed at $ 144.12, marking a movement of + 0.46% from the previous day. This move lagged behind the S&P 500’s 0.62% daily gain. At the same time, the Dow Jones rose 0.55% and the tech-rich Nasdaq lost 0.03%.
As we approached today, shares of the web search firm had lost 4.8% over the past month, trailing the computer and tech sector’s gain of 0. 29% and the 0.87% gain of the S&P 500 during this period.
Baidu Inc. will look to show strength as its next earnings release nears. In this report, analysts expect Baidu Inc. to post earnings of $ 1.89 per share. This would mark a decrease of 38.64% year over year. Meanwhile, Zacks’ consensus estimate for revenue projects net sales of $ 5.04 billion, up 8.6% from the previous year.
For the full year, our Zacks consensus estimates project earnings of $ 8.53 per share and revenue of $ 19.16 billion, which would represent changes of -12.96% and + 22.33%, respectively, over the previous year.
Any recent changes in analyst estimates for Baidu Inc. should also be noted by investors. These revisions generally reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Research indicates that these estimate revisions are directly correlated with short-term stock price dynamics. We have developed the Zacks Rank to capitalize on this phenomenon. Our system takes these rating changes into account and provides a clear and actionable scoring model.
Zacks’ ranking system ranges from # 1 (strong buy) to # 5 (strong sell). It has a remarkable, externally verified track record of success, with No.1 stocks generating an average annual return of + 25% since 1988. Over the past month, the Zacks Consensus EPS estimate has remained stagnant. Baidu Inc. currently has a Zacks rank of # 3 (Hold).
Valuation is also important, so investors should note that Baidu Inc. currently has a forward P / E ratio of 16.9. For comparison, its industry has an average forward P / E of 26.34, which means Baidu Inc. is trading at a discount to the group.
It should also be noted that BIDU currently has a PEG ratio of 9.28. This popular metric is similar to the well-known P / E ratio, except that the PEG ratio also takes into account the expected rate of earnings growth of the company. Internet Services stocks are averaging a PEG ratio of 3.68 based on yesterday’s closing prices.
The Internet – Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 168, which places it in the lowest 34% of all 250+ industries.
Zacks Industry Rank measures the strength of our industry groups by measuring the average Zacks Rank of individual stocks within groups. Our research shows that the top 50% of industries top the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and more, at Zacks.com.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.