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Baidu Inc. (BIDU) Dips More Than Broader Markets: What You Should Know

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Baidu Inc. (BIDU) closed at $135.01 in the latest trading session, marking a -1.14% move from the prior day. This change lagged the S&P 500's daily loss of 0.28%. Elsewhere, the Dow lost 0.14%, while the tech-heavy Nasdaq lost 0.14%.

Prior to today's trading, shares of the web search company had lost 9.85% over the past month. This has lagged the Computer and Technology sector's gain of 8.21% and the S&P 500's gain of 8.35% in that time.

Baidu Inc. will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.63, down 31.8% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $4.12 billion, down 15.2% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $7.88 per share and revenue of $19.67 billion, which would represent changes of -6.19% and +1.93%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for Baidu Inc.These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 10.55% lower within the past month. Baidu Inc. is currently a Zacks Rank #3 (Hold).

In terms of valuation, Baidu Inc. is currently trading at a Forward P/E ratio of 17.33. This represents a discount compared to its industry's average Forward P/E of 22.09.

We can also see that BIDU currently has a PEG ratio of 0.83. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. BIDU's industry had an average PEG ratio of 1.88 as of yesterday's close.

The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 140, putting it in the bottom 45% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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