Baidu Inc. (BIDU) Stock Sinks As Market Gains: What You Should Know
Baidu Inc. (BIDU) closed the most recent trading day at $181.34, moving -1.76% from the previous trading session. This move lagged the S&P 500's daily gain of 0.12%.
Coming into today, shares of the web search company had lost 0.92% in the past month. In that same time, the Computer and Technology sector gained 4.26%, while the S&P 500 gained 3%.
BIDU will be looking to display strength as it nears its next earnings release. On that day, BIDU is projected to report earnings of $2.02 per share, which would represent a year-over-year decline of 2.88%. Our most recent consensus estimate is calling for quarterly revenue of $4.75 billion, up 28.85% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.98 per share and revenue of $19.97 billion. These totals would mark changes of -8.37% and +27.47%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for BIDU. 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.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an 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. BIDU currently has a Zacks Rank of #3 (Hold).
In terms of valuation, BIDU is currently trading at a Forward P/E ratio of 20.55. For comparison, its industry has an average Forward P/E of 31.06, which means BIDU is trading at a discount to the group.
Also, we should mention that BIDU has a PEG ratio of 4.38. 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. The Internet - Services industry currently had an average PEG ratio of 2.9 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 227, putting it in the bottom 11% 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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