Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Baidu.com, Inc. (ADR) (BIDU) Feeds the Bad News Bears – Qihoo 360 Technology Co Ltd (QIHU), Groupon Inc (GRPN)

Page 1 of 2

Baidu (BIDU)The bears are piling up on Baidu.com, Inc. (ADR) (NASDAQ:BIDU) .

A whopping 10.6 million shares were sold short as of mid-February according to Nasdaq’s latest bi-monthly update. This is nearly twice the number of bearish wagers that were placed on China’s leading search engine a year ago. Baidu’s short interest hadn’t topped 9 million over the past year until now.

The worrywarts appear to be right — for now.

February wasn’t a good month for Baidu.com, Inc. (ADR) (NASDAQ:BIDU). The shares surrendered 16% of their value last month. A poorly received quarterly report early in the month didn’t help, and concerns about Qihoo 360 Technology Co Ltd (NYSE:QIHU) gaining ground since rolling out its own search platform last summer continue to linger.

Qihoo 360 reports tomorrow, and it could ding Baidu.com, Inc. (ADR) (NASDAQ:BIDU) if it has some encouraging metrics to offer up on its nascent search initiatives.

This doesn’t mean that there aren’t a lot of things working in Baidu’s favor here.

  • Baidu’s claims of Qihoo infringement — alleging that Qihoo is crawling and copying Baidu’s content — is gaining legal steam in a Beijing court.
  • The dot-com speedster now claims to be serving up 5 billion search queries a day across search, community, and partner sites.
  • Groupon Inc (NASDAQ:GRPN)‘s recent failures have soured companies on daily deals sites, but that didn’t stop Baidu from rolling out a second group-buying portal last month. Groupon may be shocking the market with its red ink, but at least Baidu’s profitability has remained intact as it diversifies its model.

Then we get to Baidu’s valuation.

Baidu’s stock may be trading 44% below its all-time peak two summers ago, but the Chinese Internet bellwether is still growing at a healthy clip. The end result is that Baidu is now fetching just 17 times this year’s projected profitability and less than 14 times next year’s target.

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...
X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!