Baidu Inc. (BIDU) Gains As Market Dips: What You Should Know
Baidu Inc. (BIDU) closed the most recent trading day at $131.46, moving +1.8% from the previous trading session. This move outpaced the S&P 500's daily loss of 2.14%. At the same time, the Dow lost 1.91%, and the tech-heavy Nasdaq lost 0.28%.
Heading into today, shares of the web search company had lost 7.77% over the past month, lagging the Computer and Technology sector's gain of 7.04% and the S&P 500's gain of 7.62% in that time.
Investors will be hoping for strength from Baidu Inc. as it approaches its next earnings release, which is expected to be August 30, 2022. On that day, Baidu Inc. is projected to report earnings of $1.63 per share, which would represent a year-over-year decline of 31.8%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales 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 might also notice recent changes to analyst estimates for Baidu Inc.These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
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 remained stagnant within the past month. Baidu Inc. currently has a Zacks Rank of #3 (Hold).
Looking at its valuation, Baidu Inc. is holding a Forward P/E ratio of 16.39. For comparison, its industry has an average Forward P/E of 22.55, which means Baidu Inc. is trading at a discount to the group.
Investors should also note that BIDU has a PEG ratio of 0.79 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Internet - Services was holding an average PEG ratio of 1.91 at yesterday's closing price.
The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 74, putting it in the top 30% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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