- Believing mobile monetization growth is set to slow and that company is facing "intense competition," JPMorgan has downgraded Baidu to Neutral in the wake of last week's mixed Q1 results and subdued Q2 guidance, and cut its target by $25 to $215.
- JPMorgan estimates Baidu's mobile ad monetization rate is now at 80%-90% of PC level, and that mobile monetization growth will be near PC levels going forward. It doubts revenue growth will "surprise on the upside" until online-to-offline (O2O) initiatives or unique mobile products take off, and notes Alibaba and Tencent have their own O2O ambitions.
- BIDU -1.2% premarket to $201.30. Yesterday, T.H. Capital upgraded Baidu to Buy, arguing mobile/local search ad initiatives (including Baidu's efforts to let advertisers target based on geography) will act as a growth driver.
- Last week: Baidu falls post-earnings; bulls pleased with mobile, offline growth