Timothy Pereira

Baidu’s Q1 Earnings: Long-Term Positive

Baidu is growing revenue fast and the trailing price-to-sales ratio is now 31. What really matters is whether there is a large enough market for a company's products, whether the company's business model works, whether they can maintain their market share, and whether the company's management executes well and reaches its targets. I have no idea where you get the idea that 20X sales was considered high during the height of the dot-com bubble. Many companies had barely any revenue to speak of and had multi-billion dollar market caps. EBay had an extremely high valuation and it grew into it. Amazon has had a high valuation for a decade.