In the latest trading session, Baidu Inc. (BIDU) closed at $101.79, marking a -1.12% move from the previous day. This change lagged the S&P 500’s 0.16% loss on the day. At the same time, the Dow lost 0.12%, and the tech-heavy Nasdaq lost 0.33%.
Heading into today, shares of the web search company had lost 3.48% over the past month, outpacing the Computer and Technology sector’s loss of 7.54% and the S&P 500’s loss of 10.5% in that time.
Wall Street will be looking for positivity from BIDU as it approaches its next earnings report date. The company is expected to report EPS of $0.74, up 80.49% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $3.14 billion, down 12.7% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $7.66 per share and revenue of $16.48 billion, which would represent changes of +2.41% and +6.24%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for BIDU. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.
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.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. BIDU is holding a Zacks Rank of #2 (Buy) right now.
Investors should also note BIDU’s current valuation metrics, including its Forward P/E ratio of 13.44. For comparison, its industry has an average Forward P/E of 25.37, which means BIDU is trading at a discount to the group.
Also, we should mention that BIDU has a PEG ratio of 1.34. 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 2.16 as of yesterday’s close.