Baidu tops $226 as Street praises Q2 numbers; Qihoo, Sohu also gain


Goldman has raised its 2014-2016 Baidu (BIDU +10.9%) EPS estimates by 17%-23% following its sizable Q2 EPS beat and above-consensus Q3 guidance, and hiked its target by $35 to $260. BofA/Merrill, Deutsche, and Piper have also raised their Baidu PTs.

Goldman was pleased with several datapoints provided in the Q2 report and CC (transcript). Among them: 1) Baidu topped 500M mobile search monthly active users (MAUs) in June. 2) Maps MAUs have passed 200M. 3) Baidu's app distribution platforms (led by 91 Wireless) averaged 130M downloads/day in Q2. 4) The Nuomi daily deals unit (acquired from Renren) has seen its user base double since Q4.

BofA/Merrill observes Baidu's aggressive spending growth is now being fueled more by hiring than by marketing spend, something it expects will translate into future leverage. Marketing spend fell to 11.5% of revenue from 14.1% in Q1, while R&D grew to 14.6% from 13.6%.

Baidu made fresh highs today, and provided a lift to rivals Qihoo (QIHU +3.7%) and Sohu (SOHU +2.2%) along the way.

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Comments (5)
  • Michael Bryant
    , contributor
    Comments (7212) | Send Message
     
    One of the few stocks that rose today.
    25 Jul 2014, 08:13 PM Reply Like
  • 13628842
    , contributor
    Comment (1) | Send Message
     
    perhaps purchase NQ Mobile
    25 Jul 2014, 09:56 PM Reply Like
  • James Sands
    , contributor
    Comments (2726) | Send Message
     
    Baidu is above and beyond the leader in digital advertising and marketing in China with Tencent a far second and Qihoo challenging Tencent over the next few years....
    25 Jul 2014, 10:31 PM Reply Like
  • b0566
    , contributor
    Comment (1) | Send Message
     
    Bought BIDU in the past. One of my few VERY GOOD investments
    26 Jul 2014, 10:52 AM Reply Like
  • Piptief
    , contributor
    Comments (1324) | Send Message
     
    Not so long ago I owned Baidu at $90 bucks...and sold the darn thing. Man am I kicking myself today
    26 Jul 2014, 10:53 PM Reply Like
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