Baidu.com, Inc. (ADR) (NASDAQ:BIDU)

CAPS Rating: 4 out of 5

Baidu is the leading Chinese-language Internet search provider.

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Player Avatar SwingTraderBoss (82.83) Submitted: 11/19/2012 2:53:32 PM : Outperform Start Price: $92.52 BIDU Score: +89.15

It will maintain its position as dominant market leader in China's online search market, which is still in an early high-growth stage.The current historically low valuation appears to be very attractive provided that 1) the economic situation in 2008 was much worse than the current condition and most of the firm's financial metrics were at relatively low levels in 2008 2) the company's capital return metrics including ROA, ROIC, and ROE have experienced a solid improvement over the past 5 years; 3) BIDU has also become more profitable, and the firm's EBITDA margin is expected to be fairly stable; and 4) Despite the relatively low estimated revenue and EPS growth rates, BIDU's EBITDA is expected to grow significantly over the next 2 years.

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