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Baidu, Inc. Message Board

  • bob.satish bob.satish Dec 31, 2012 4:18 PM Flag

    QIHU ANNOUNCES DEAL WITH GOOGLE

    My last incredible post for the year!!!!!! Should have bought in August like I said.

    Qihoo 360 Technology Co. (QIHU) surged in New York, driving the benchmark index of Chinese U.S.-listed stocks to seven-month high, on prospects a partnership with Google Inc. (GOOG) will bolster revenue this year.

    The Bloomberg China-US Equity Index (CH55BN) of the most-traded Chinese shares in New York jumped 2 percent to 98.70 by 2:53 p.m., bringing its 2012 advance to 9.6 percent. Qihoo, a Beijing-based company that started its Internet search engine in August, is poised to close at the highest level since May 20, while web data-center operator 21Vianet Group Inc. (VNET) climbed the most in four months. China Life Insurance Co. (LFC) traded at a premium to its Hong Kong stock for the first time in six days after the regulator said insurers can set up mutual funds. Qihoo, which offers anti-virus programs as well as the most-used web browser in China, jumped 86 percent in 2012, the biggest gainer of the China-US gauge’s 55 stocks. The company’s tie-up with Google will start soon and contribute $140 million of revenue this year, Juan Lin, an analyst at Wedge Partners Corp. wrote in a report. Data showing Chinese factory output grew at the fastest pace in 19 months in December also boosted stocks traded in the U.S.

    “There will be more growth in Qihoo and now with this cooperation with Google revenues and earnings need to go up a bit in 2013,” Kirk Adams, a director of research at Wedge Partners, said by phone yesterday from Greenwood Village, Colorado. “As its cooperation with Google will add cash to Qihoo, the market will continue to price in the revenue growth in 2013.”

    ETF Climbs
    The iShares FTSE China 25 Index Fund, the largest Chinese exchange-traded fund in the U.S., added 1.8 percent to $40.28, extending its 2012 climb to 16 percent. The Standard & Poor’s 500 Index rose for the first time in six days, gaining 0.8 percent to 1,413.94 as U.S. Senate Majority Leader Harry Reid said talks on a deal to avert the so-called fiscal cliff are “progressing.”

    Qihoo’s American depositary receipts surged 5.3 percent to $28.76. Chief Financial Officer Alex Xu didn’t respond to an e- mail seeking confirmation on the impact of cooperation with Google on revenue.

    The company is considering partnering with Google’s advertising system, Chief Executive Officer Zhou Hongyi said, according to a Sept. 11 report on Sina News.

    Qihoo’s tie-up with Google’s China unit will probably start at the beginning of 2013, Wedge Partners’ Lin wrote in the note yesterday. The company will continue to build its own advertising system to profit from online search queries, she wrote.

    Qihoo versus Baidu
    The ADR’s advance sent valuations to 33 times estimated earnings, up from a multiple of 17 on Aug. 15, the day before Qihoo started its search service, data compiled by Bloomberg show. Qihoo’s valuation compares with a ratio of 16 times expected earnings for Baidu Inc., its bigger competitor.

    Baidu, owner of China’s most-used search engine, added 0.8 percent to $99.80 in New York yesterday, halting a two-day slump and trimming its 2012 slide to 14 percent.

    Wallace Cheung, a Hong Kong-based analyst at Credit Suisse Group AG, cut his price estimate yesterday for Bejing-based Baidu to $80 from $82, maintaining a rating equivalent to sell on the stock.

    21Vianet, also based in Beijing, jumped 8.5 percent to $9.62 in U.S. trading yesterday to gain 4.4 percent in the year. Trading volumes were more than double the daily average over the past three months, data compiled by Bloomberg showed.

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