Baidu Continues Downward Spiral
After reporting about Baidu’s legal challenges, it appears things aren’t getting any better for China’s leading search engine. Despite the launch of a new search product, earnings estimates for Baidu continue to plummet.
According to Tech Trader Daily, a pair of analysts have cut Baidu’s earnings forecast. Dick Wei from J.P. Morgan has cut his estimate by 5% for 2008 and by 19% for 2009 due to the reduced income Baidu can expect from not accepting income to improve organic rankings. He does, however, predict that Baidu will retain its market leadership. A slow customer growth in Q4 and state of the economy has caused Pacific Crest’s Steve Weinstein to lower his forecasts as well.
Despite this their forecasts, Baidu’s stock closed at $111.30 today – up 6.47%. But I wouldn’t recommend investing anytime soon.