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Unfortunately I never made it down to South Beach because my plane decided not to take off on time. So my purchase was also delayed...but here it is:
Alright…help me understand this. There are 300,000,000 people in the United States. There are 1,300,000,000 people in China. Google is basically not allowed in China. You think Chinese people like to use search engines? You’re darn skippy they do. So basically they use Baidu instead of Google. Now then…a lot of people in China still don’t own a computer. You want growth???…hmmm…do the math
Today I bought BIDU at 107.55. I will sell it in 4 – 6 weeks at 123.87. Here’s why I like BIDU:
One good place is the chart:
That’s right. This stock is going up. Why? Because people aren’t stupid, that’s why. BIDU once again hit an all time high after reporting pornographically strong earnings. It’s market cap is now almost $40 billion dollars. This isn’t a fly by night internet company. By the way, they don’t have any debt on their balance sheet so don’t worry at all about their financial health.
Baidu, Inc. provides Chinese and Japanese language Internet search services. Its search services enable users to find relevant information online, including Web pages, news, images, multimedia files, and blogs through the links provided on its Websites. The company also offers online community-based products and entertainment platforms; an instant messaging service; and a consumer-oriented e-commerce platform. In addition, it designs and delivers online marketing services and auction-based P4P services that enable its customers to reach users who search for information related to their products or services. The company serves online marketing customers consisting of small and medium sized enterprises, large domestic corporations, and Chinese divisions or subsidiaries of multinational corporations primarily operating in the medical, machinery, education, franchising, electronic products, e-commerce, ticketing, tourism, information technology, consumer products, real estate, entertainment, and financial services industries. Basically, it’s the Chinese knockoff of Google. So you think more Chinese people are going to be using computers? Then BIDU is a complete no brainer.
Baidu already has over 70% of the Chinese search market – which is the biggest in the world. A lot of their gains in market share came from Google. Bye bye Google. By the way, this overall market is growing and growing and Baidu has yet to implement a lot of the ad gadgets that make up a great deal of Google’s revenue streams. With all the cash that’s being generated by the growing earnings, they will be pumping up the R&D to come up with new junk to make more monies. It’s other competitors keep shrinking their market share and everyone knows these trends don’t reverse. Effectively BIDU is now the winner and to the winner goes the spoils.
So what kind of money do they make?
Last week Baidu reported total revenues in the third quarter of 2010 of $337.2 million, a 76.4% increase from the corresponding period in 2009.
Net income in the third quarter of 2010 was $156.4 million, a 112.4% increase from the corresponding period in 2009.
Baidu had about 272,000 active online marketing customers in the third quarter of 2010, representing a 25.9% increase from the corresponding period in 2009 and a 7.1% increase from the previous quarter.
As of September 30, 2010, the Company had cash, cash equivalents and short-term investments of $1.037 billion.
Baidu currently expects to generate total revenues in an amount ranging $354.2 million to $364.7 million for the fourth quarter of 2010, representing an 88% to 93.5% year-over-year increase. This forecast reflects Baidu's current and preliminary view, which is subject to change.
Look…I can go ahead and put together a valuation analysis based on where I see earnings going and what it’s trading at now. I’m not going to lie to you. This stock is ridiculously expensive trailing P/E of 89. Picture this scenario:
CURLY: Nyuk, nyuk, nyuk!
MOE: Oh, darling! Leave your husband and fly away with us.
CURLY: You know you love us, not that pickle-puss husband of yours! Nyuk, nyuk, nyuk!
The angry husband walks up to Curly and Moe.
HUSBAND: What's goin' on here?!
CURLY: Scram, buddy! You're interferin' with romance!
MOE: Go a...
Curly and Moe do a double take when they realize that the husband is the same man they had a fight with in the street.
CURLY AND MOE: NYAAA-AAA-AAAAH!
The husband then also recognizes Moe and Curly.
HUSBAND: (pulling out his gun) Why, you!
CURLY AND MOE: Nyaaa-aaaa-aaah!
Actually, the boss is no stooge and here what he has to say:
"Strong execution on our initiatives to expand our customer base and enhance customer service drove another quarter of strong results," said Robin Li, chairman and chief executive officer of Baidu. "By focusing on continuously improving our online marketing system and customer engagement while building awareness of search engine marketing, we are successfully enhancing Baidu's position as a key enabler of China's Internet industry."
Mr. Li continued, "On the user experience front, during the quarter we announced several exciting developments including the Baidu Open Application Platform, the first platform integrating web search with an applications library. Such pioneering initiatives that focus on Internet user needs are at the center of our R&D investment."
Jennifer Li, Baidu's chief financial officer, commented, "We are pleased to have delivered record margins in the third quarter, even as we actively invested in sales and marketing, R&D and network equipment. Looking forward, we will continue to invest aggressively to support Baidu's long-term growth."
Sure it’s expensive. Just like Thomas Sweet Ice Cream in Princeton…but it’s worth it. Actually, the forward P/E based on their sandbagged expectations isn’t too bad at all at only 46. Just like when I bought AAPL stock…sometimes you just have to take a leap of faith and go with the mo. (Or Moe..nyaaa-aaa-aaah)
So…tell me if you like this write up.
I am HUGE!!
$$$MR. MARKET$$$
Alright…help me understand this. There are 300,000,000 people in the United States. There are 1,300,000,000 people in China. Google is basically not allowed in China. You think Chinese people like to use search engines? You’re darn skippy they do. So basically they use Baidu instead of Google. Now then…a lot of people in China still don’t own a computer. You want growth???…hmmm…do the math
Today I bought BIDU at 107.55. I will sell it in 4 – 6 weeks at 123.87. Here’s why I like BIDU:
One good place is the chart:
That’s right. This stock is going up. Why? Because people aren’t stupid, that’s why. BIDU once again hit an all time high after reporting pornographically strong earnings. It’s market cap is now almost $40 billion dollars. This isn’t a fly by night internet company. By the way, they don’t have any debt on their balance sheet so don’t worry at all about their financial health.
Baidu, Inc. provides Chinese and Japanese language Internet search services. Its search services enable users to find relevant information online, including Web pages, news, images, multimedia files, and blogs through the links provided on its Websites. The company also offers online community-based products and entertainment platforms; an instant messaging service; and a consumer-oriented e-commerce platform. In addition, it designs and delivers online marketing services and auction-based P4P services that enable its customers to reach users who search for information related to their products or services. The company serves online marketing customers consisting of small and medium sized enterprises, large domestic corporations, and Chinese divisions or subsidiaries of multinational corporations primarily operating in the medical, machinery, education, franchising, electronic products, e-commerce, ticketing, tourism, information technology, consumer products, real estate, entertainment, and financial services industries. Basically, it’s the Chinese knockoff of Google. So you think more Chinese people are going to be using computers? Then BIDU is a complete no brainer.
Baidu already has over 70% of the Chinese search market – which is the biggest in the world. A lot of their gains in market share came from Google. Bye bye Google. By the way, this overall market is growing and growing and Baidu has yet to implement a lot of the ad gadgets that make up a great deal of Google’s revenue streams. With all the cash that’s being generated by the growing earnings, they will be pumping up the R&D to come up with new junk to make more monies. It’s other competitors keep shrinking their market share and everyone knows these trends don’t reverse. Effectively BIDU is now the winner and to the winner goes the spoils.
So what kind of money do they make?
Last week Baidu reported total revenues in the third quarter of 2010 of $337.2 million, a 76.4% increase from the corresponding period in 2009.
Net income in the third quarter of 2010 was $156.4 million, a 112.4% increase from the corresponding period in 2009.
Baidu had about 272,000 active online marketing customers in the third quarter of 2010, representing a 25.9% increase from the corresponding period in 2009 and a 7.1% increase from the previous quarter.
As of September 30, 2010, the Company had cash, cash equivalents and short-term investments of $1.037 billion.
Baidu currently expects to generate total revenues in an amount ranging $354.2 million to $364.7 million for the fourth quarter of 2010, representing an 88% to 93.5% year-over-year increase. This forecast reflects Baidu's current and preliminary view, which is subject to change.
Look…I can go ahead and put together a valuation analysis based on where I see earnings going and what it’s trading at now. I’m not going to lie to you. This stock is ridiculously expensive trailing P/E of 89. Picture this scenario:
CURLY: Nyuk, nyuk, nyuk!
MOE: Oh, darling! Leave your husband and fly away with us.
CURLY: You know you love us, not that pickle-puss husband of yours! Nyuk, nyuk, nyuk!
The angry husband walks up to Curly and Moe.
HUSBAND: What's goin' on here?!
CURLY: Scram, buddy! You're interferin' with romance!
MOE: Go a...
Curly and Moe do a double take when they realize that the husband is the same man they had a fight with in the street.
CURLY AND MOE: NYAAA-AAA-AAAAH!
The husband then also recognizes Moe and Curly.
HUSBAND: (pulling out his gun) Why, you!
CURLY AND MOE: Nyaaa-aaaa-aaah!
Actually, the boss is no stooge and here what he has to say:
"Strong execution on our initiatives to expand our customer base and enhance customer service drove another quarter of strong results," said Robin Li, chairman and chief executive officer of Baidu. "By focusing on continuously improving our online marketing system and customer engagement while building awareness of search engine marketing, we are successfully enhancing Baidu's position as a key enabler of China's Internet industry."
Mr. Li continued, "On the user experience front, during the quarter we announced several exciting developments including the Baidu Open Application Platform, the first platform integrating web search with an applications library. Such pioneering initiatives that focus on Internet user needs are at the center of our R&D investment."
Jennifer Li, Baidu's chief financial officer, commented, "We are pleased to have delivered record margins in the third quarter, even as we actively invested in sales and marketing, R&D and network equipment. Looking forward, we will continue to invest aggressively to support Baidu's long-term growth."
Sure it’s expensive. Just like Thomas Sweet Ice Cream in Princeton…but it’s worth it. Actually, the forward P/E based on their sandbagged expectations isn’t too bad at all at only 46. Just like when I bought AAPL stock…sometimes you just have to take a leap of faith and go with the mo. (Or Moe..nyaaa-aaa-aaah)
So…tell me if you like this write up.
I am HUGE!!
$$$MR. MARKET$$$
Thanks for the pick $$$MM$$$
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