Saturday, April 30, 2011

Baidu Flat for Week After Reporting Near-Record Q1 Earnings (Chart) *Up +7.77% for April* BIDU

● Baidu Planet 

Baidu reported near-record Q1 2011 financial results on April 27, 2011

Baidu Overview

Baidu Baidu closed the week at $148.52 on Friday, April 29, 2011. BIDU was down -0.09% for the week, was up +7.77% for April, and is up +53.86% for 2011. BIDU is -2.53% below the all-time closing high reached on Tuesday, April 26, 2011 of $152.37. 

S&P 500 By comparison, the overall market, the S&P 500, at 1363.61, was up +1.96% for the week, was up +2.85% for April, and is up +8.43% for 2011. SPX is +101.56% since the March 9, 2009 market cyclical low. SPX closed at a multi-year closing high of 1363.61 on Friday, April 29, 2011, the highest close since the June 9, 2008 close of 1404.05. BIDU is easily outperforming the overall market in 2011. A review of the S&P 500 is here [S&P 500 Rises to Highest Close Since June 9, 2008! (Chart) *VIX continues near June 2007 lows*].

Baidu Fundamentals Baidu reported near-record Q1 2011 financial results on Wednesday, April 27, 2011, but the bar has been set high for Baidu in the world's largest Internet market. These financial results are reviewed and analyzed on this blog at the Baidu Financial Performance page. This was after stellar fourth quarter 2010 financial results on January 31, 2011.

Economic and Market News Information about the USA and world economies plus the USA financial system are posted at Boom Doom EconomyFinancial Controls, and Baidu Planet. Additional current commentary on both the overall stock market and economy is posted at Matrix Markets.

Baidu Daily Chart Below is the BIDU daily chart since February 11, 2011 to illustrate recent price interactions.

Noteworthy Closing Prices
Current Close: $148.52
2011 and All-Time High: April 26 $152.37
2011 Low: January 3 $99.73
YE December 31, 2010: $96.53

Baidu Chart Review
Intermediate Term Trend ascending 25d sma > ascending 50d sma, bullish
Long Term Trend BIDU > 10 month ema = 111.19, bullish since April 2009
Key Resistance 4-26-11 all-time closing high 152.37, 4-28-11 all-time intraday high 156.04, prior all-time closing high 150
Key Support 20 day avg 146, prior all-time closing highs 147, 135, & 130, 50 day avg 133
Moving Averages above all averages monitored: 20d, 25d 50d, 100d, 200d averages
RSI 14 Day = 61.23 is reasonable, descending
RSI 28 Day = 69.88 is near overbought, descending
MACD (12,26,9) = -0.45, descending
Volume moderate 8.9M latest day, 50 day average = 7.4M
Price Earnings Ratio = 81.97, has been high 90s to low 100s in past year (Google Finance)
Market Capitalization = $51.81 billion (Google Finance)

Conclusion Baidu rallied to yet another all-time closing high on Tuesday, April 26, then dipped below on  Wednesday, April 27. BIDU dropped again on Thursday, after Q1 2011 earnings were released after market close Wednesday. The bar has been set high for Baidu in the world's largest Internet market and many investors were hoping Baidu would report record financial results for Q1 2011, but this was after Baidu reported incredible financial results on January 31, 2011 for the Q4 2010. Q4 is normally the annual cyclical high for Internet and technology sector companies and Q1 is the annual cyclical low. Therefore, Baidu's Q1 2011 financial results were amazing, but, again, investors were hoping the growing Chinese Internet market would push Baidu earnings to yet another all-time high regardless of the annual cycle. These financial results are reviewed and analyzed on this blog at the Baidu Financial Performance page.

Disclosure We are long BIDU.

About Baidu

Baidu, Inc. is the leading Chinese language Internet search provider. As a technology-based media company, Baidu aims to provide the best way for people to find information. In addition to serving Internet search users, Baidu provides an effective platform for businesses to reach potential customers. Baidu's ADSs, each of which represents one Class A ordinary share, currently trade on the NASDAQ Global Select Market under the symbol "BIDU".

The Baidu Story

Many people have asked about the meaning of our name. "Baidu" was inspired by a poem written more than 800 years ago during the Song Dynasty. The poem compares the search for a retreating beauty amid chaotic glamour with the search for one's dream while confronted by life's many obstacles. "…hundreds and thousands of times, for her I searched in chaos, suddenly, I turned by chance, to where the lights were waning, and there she stood." Baidu, whose literal meaning is hundreds of times, represents persistent search for the ideal.

Baidu chose a poetic Chinese name because it wants the world to remember its heritage. As a native speaker of the Chinese language and a talented engineer, Baidu focuses on what it knows best - Chinese language search. Applying avant-garde technology to the world's most ancient and complex language is as challenging as it is exciting. At least people here at Baidu think so. As having diligently disclosed in the Prospectus of our recent Initial Public Offering, we believe there are at least 38 ways of saying "I" in Chinese. It is important that we master all the ways of addressing oneself in Chinese because our users depend on us to address every one of their daily queries. And trust us, pin pointing queries in the Chinese language is an art rather than a science.

Our mission is to provide the best way for people to find information. To do this we listen carefully to our users' needs and wants. Have we collected all the Chinese web pages they want to see? Are the pages current and up to date? Are the search results closely related to their queries? Did we return those search results instantly? To improve user experience, we constantly make improvements to our products and services. For example, we introduced "phonetic" or "pin-yin" search which allows our users to type in Chinese keywords using English alphabets. This feature is designed to skip the switching from English inputting to Chinese inputting and for when the user is not sure of the written form of a keyword. Our users definitely notice the many little things that we do differently to ensure a simple and reliable search experience every time. 

In addition to serving individual users, we also serve as a media platform for online marketing customers. We not only provide our customers easy access to one of the largest online audiences in China but also targeted groups with defined interests as indicated by queries. Unlike traditional online advertising services which charge by flat fee, our marketing products and services are performance based. Our Pay for Performance model has taken the market by storm because it is cost effective and measurable.

We know that a lot of interesting things are going on in the Internet space, but we don't want to lose focus. China's Internet search industry is only a newly discovered territory. We see vast untapped grounds in our home base and we believe there are still plenty of prizes to be claimed by the best players.

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