#8 - Baidu (NASDAQ:BIDU)
Baidu (NASDAQ: BIDU) - Baidu looks like a very inviting Christmas present. Sitting there with a P/E ratio of just 17, it has had profit growth of 6% in 2018, but Wall Street analysts are expecting the stock to return to the double-digit earnings growth it has enjoyed for the last few years in 2019. And “the Chinese Google” has a market cap of just $61 billion as compared to the $729 billion market cap of GOOGL. And if that weren’t enough consider that even if Baidu’s market was limited to China that would still account for nearly 20% of the world’s population. The problem is for all those great numbers, Alphabet remains the better option. Furthermore, investors should be mindful that owning BIDU does not mean owning shares in the actual company. Rather like Alibaba and Tencent for example, investors who buy Baidu stock are actually taking ownership of shares in a “variable-interest entity” located in the Cayman Islands that has links to the parent company. This may be a distinction without a difference in terms of profitability, but it is a risk that you may not want to take. The holidays should be a time when you rest and relax, not worry about the growth of a speculative stock.
About Baidu
Baidu, Inc engages in the provision of internet search services in China. It operates through two segments: Baidu Core and iQIYI. The company offers Baidu App to access search, feed, and other services using mobile devices; Baidu Search to access its search and other services; Baidu Feed that provides users with personalized timeline based on their demographics and interests; Baidu Health that helps users to find the doctor and hospital for healthcare needs; and Haokan, a short video app.
Read More - Current Price
- $85.80
- Consensus Rating
- Hold
- Ratings Breakdown
- 6 Buy Ratings, 10 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $113.75 (32.6% Upside)
As the ball gets set to drop on 2018, it’s time for investors to take off the rose-colored glasses and see their portfolio for what it really is. It’s been a year where volatility has returned to the market in a big way, and there continue to be unresolved issues both in terms of domestic policy (e.g. the pace of interest rate hikes, a potential government shutdown) and macroeconomic concerns (i.e. the continuing trade dispute with China). All of these can cause you to want to just hang on and wait until the dust settles. But that would be the wrong approach. Now is the perfect time to take some profits from companies that you think may be ready to take a pause after a great year. And, it may be a prudent time to take some losses on underperforming stocks. This “harvesting” can help offset your gains and may make you come out ahead in terms of your taxable events.
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