Do buy Baidu

A deep-dive look at China's most successful Internet company.

By Motley Fool Mar 22, 2013 2:51PM

Man with laptop copyright Ken Seet, SuperStockBy John Reeves and Pamela Peerce-Landers

China's Baidu (BIDU) is one of the most successful Internet companies in the world, and it has certainly made a lot of money for investors since it went public in 2005. 

Currently trading at around 18 times trailing earnings  -- vs. roughly 25 for Google (GOOG) -- Baidu just might be an attractive bargain right now.

There are reasons for hesitation, however. Baidu faces fierce competition, and there are legitimate concerns about China's overall economic health at the moment. And the company concedes that it's in a transitional phase as it attempts to monetize mobile search.

Is now an ideal time to invest in a proven winner at a compelling price? Or is the market accurately reflecting Baidu's diminished future prospects?

We think there are strong arguments on both sides of the debate, though we ultimately lean more toward the bull case. In the detailed slidedeck below, we take a closer look at the various arguments for and against Baidu. The entire slideshow is quite long, but you should be able to move through it in a reasonable amount of time.

To view the entire presentation on Baidu, just click on the arrows in the slideshow below.  

More from

Mar 24, 2013 7:59PM
RE... isn't that like going back to the same bar that served you poison whiskey? China is suffering a severe housing bubble, a severe excess in combustible fuels that is creating toxic level smog, severe turmoil in wages and productivity and... no one is paying on obligations just like they aren't paying Ben Bernanke on his... is it wise to trust fresh paint and lipstick on the pig? You seem to just want to make money... regardless. Your choice on that.
Mar 22, 2013 3:46PM

BIDU....Was a pretty good investment at one time, but it's been awhile; Maybe give it another look.

Mar 25, 2013 2:07AM

NO....I'm pretty sure Microsoft owns this Website and Content anymore...

I believe MS and NBC parted ways last Summer or Fall...


They no longer put Disclaimers on here about GE being the Parent company of NBC, nor do they refer to NBC any longer...


This Site is known now as MSN Money @, think I use to call it MoneyCentral, maybe still is?

I think MSN, means Microsoft Network ??

And in recent weeks or months....Comcast Corp....Bought GE's ownership of NBC or there portion of ?

Mar 25, 2013 1:55AM

Yes investments or investing has no other purpose, BUT to make money or protect parts of our retirement...I do it for the same reason, people drive off to work everyday...To support themselves and/or their families...

The same reason individuals save money in Banks or Cash producing instruments...

The same reason we/wife was in a Commercial business in the City for 20 years..

And the same reason we also ran a  Farm/small ranch...All in the name of hopeful Profit overall.

We didn't do it or no one does, for entertainment or any betterment of others, unless we shared in the bounty....That's almost foolish, unless they are an eccentric millionaire...

My wife couldn't hire people if she or the Company didn't make money first..

I didn't take livestock to the sale barns or auction rings...To give them away..

And as a retiree, I am a self-directed investor, that works a few hours a day or week...And I pay myself for it...Some weeks, years are great...One was not very good (2008).

Water under the Bridge...

Mar 25, 2013 1:38AM

VL......I haven't  been invested in China or Companies for going on almost two years...

Chinese Solar Co.s...were the last I sold, almost a year ago...

Taiwanese gone for about 2 years..

Nothing in Japan for well over 5-6 years..Longer?

I have not planned on going back to any Asian investments in near term..

As you already know, China has been in a little slump of it's own...The World's Recovery is their recovery to lose...

But we are invested in 2-3 Foreign Companies, one being the only Foreign Gold miner in China..

Another International Co, that ships Coal to China..

And several other International Cos, that do business in China or India..

I think it very prudent to invest in Companies, that do business in those lands, because of an "emerging Middle Classes."

I only thought about BIDU again, because it was " a three bagger" when we owned it before...

Was a very nice or profitable choice for us..

Mar 24, 2013 12:31PM

Well there is talk on the street V_L....That as an investor, better portfolios should have some Foreign exposure or at least positions in Multi-National Companies..


BIDU....Was a very good investment for us, until I dropped the positions at a nice high..

Goldminers...Have helped us get through some tough times.

Tobacco....Has been a Fantastic investment, with excellent divs too..

Semiconductors...Gave us about 40-50% gains...Until sold.

Chemicals and Pharma.....Make/made for very good plays.

There may have been others....Can't recall all, but those above have/are all been Foreign

Only losses have been with (two) Chinese Solar, until dropped last year; Losing about 20-25%..

Solar turned sour over the last couple years, for various reasons..

And we have other investments, in probably about 5-7 Internationals, many do business in China. 

Mar 24, 2013 12:38PM

BTW....."NBC".....Has NOTHING to do with this Website...

Mar 24, 2013 6:28AM

Isn't it Chinese? Why on EARTH would you invest in anything Chinese? Wouldn't it be better to invest in jobs worldwide and restore economic stability, than to invest in the underminer?



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