BIDU

Quiet Trading This Week

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If you haven’t yet read Part I of our Best Ideas piece, you can find it here. The holiday week was very quiet, as expected. However, a few news items did hit the wires that we’d like you to be aware of. First, we received word from ChannelAdvisor, a leading cloud-based e-commerce solutions provider, that same-store sales momentum across the e-commerce spectrum may have slowed in the third week of December. This runs counter to the strong data we’ve been receiving from the space through most of the holiday season. However, we believe the recent news release is something we’d categorize as “noise” (immaterial), especially given the significant date-shifting performed in the representation of the data. ChannelAdvisor had the following … Read more

Baidu Up Big Since August Email Transaction Alert; Valuentum Members Cheer!

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Valuentum has two actively-managed portfolios, one is its Best Ideas portfolio (housed in its Best Ideas Newsletter) and the other is its Dividend Growth Newsletter (housed in its Dividend Growth Newsletter). Each edition of its Best Ideas Newsletter is released on the 15th of the month, while each edition of its Dividend Growth Newsletter is released on the 1st of each month. Though not all members use the newsletters, the monthly publications represent the avenues through which we deliver the respective actively-managed portfolios that ultimately are the gauge we use to measure performance. We send out email transaction alerts to members to keep them abreast of new additions to and removals from these portfolios, as well as any weighting changes … Read more

Looking for Alpha? It’s In Our Best Ideas Newsletter

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Best Ideas portfolio holdings Buffalo Wild Wings (BWLD) and Baidu (BIDU) reported fantastic third-quarter results after the close yesterday, sending both of their shares higher in Wednesday trading! Buffalo Wild Wings closed at $141.22 per share, up over 9% on the trading session, while Baidu closed at $164.93 per share, up nearly 3.5% for the day. Baidu was added to our Best Ideas portfolio August 1, 2013 at $133.60 per share (click here for Best Ideas portfolio transaction log). If you didn’t receive that email, contact us immediately at info@valuentum.com. A 23% gain in just a couple months isn’t too bad, and we’re expecting further upside to shares. Buffalo Wild Wings has been a holding in our Best Ideas portfolio … Read more

Get To Know Yahoo!’s Management; We Value Alibaba at $75 Billion

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The only question that comes to mind after looking at the below slide is: What turnaround? Image Source: Yahoo GAAP revenue down 5%. Revenue ex-TAC down 1%. Adjusted EBITDA down 19%. Income from operations down 39%. Non-GAAP operating income down 27%. Net earnings down 91%. EPS attributable to Yahoo down 89%. Non-GAAP EPS down 13%. Free cash flow down 73%. Cash and marketable securities down 66%. It’s flat-out puzzling that CEO Marissa Mayer included the following statement in the third-quarter press release: “I’m very pleased with our execution, especially as we’ve continued to invest in and strengthen our core business.” We understand the importance of staying positive, but her statement is quite a stretch considering actual financial performance at the core Yahoo business.  The only line item in … Read more

Plenty of Growth Ahead for Chinese Internet Companies

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The Chinese Internet space has been a fantastic growth story through the course of 2013. Shares of Best Ideas Newsletter portfolio holding Baidu (click ticker for report: ), Qihoo (QIHU), Sohu.com (click ticker for report: ), and Tencent (click ticker for report: ) are all up at least 50% year-to-date. What do all of these companies have in common? They all have exposure to China’s rapidly-growing Internet usage as well as the country’s Internet search market. Search growth in China is phenomenal. Image Source: China Internet Watch In the second quarter of 2013, the value of the Chinese search market surged approximately 35% year-over-year (shown above), lapping a very robust growth rate well above 50% during the same period of 2012. Chinese search … Read more

Is the Worst Behind China?

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Summer was not very kind to the Chinese economy. We’ve seen the country hit by concerns of credit overexpansion, as well as negative manufacturing data and declining exports. On top of macro issues, companies that usually prosper in China like Nike (click ticker for report: ) and Yum! Brands (click ticker for report: ) posted weak results. However, after bottoming out at 47.7 during July, the HSBC China Manufacturing PMI compiled by Markit turned modestly positive at 50.1 during the month of August (anything above 50 represents expansion). Industry destocking appears to be mostly completed, and manufacturers are receiving more new orders. HSBC’s lead Asian economist Hongbin Qu implied the economy had bottomed, saying in the press release: “The final … Read more

Baidu Might Buy China’s Groupon

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Reports are circulating that Best Ideas Newsletter portfolio holding Baidu (click ticker for report: ) is interested in taking a controlling stake in Renren’s (RENN) daily deal site Nuomi.com, as well as Ding Ding Maps (a map service). Both potential deals could make Baidu look a little more like another Best Ideas portfolio holding, Google (click ticker for report: ). Numoi.com is a daily deals site similar to Groupon (click ticker for report: ) and Amazon’s Living Social (click ticker for report: ), as well as Google’s own Daily Offers. Deals change on geographic location, and the service seems to cover most major cities in China. Without question Baidu could probably start its own daily deals service, but that strategy … Read more

Baidu Surges on Strong Results and Outlook

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Chinese search giant Baidu (click ticker for report: ) reported fantastic second quarter results Wednesday afternoon. We recently identified Baidu as one of the cheapest stocks on the market, after making a bullish call on the name in early April. Revenue surged 39% year-over-year to $1.2 billion, easily exceeding consensus expectations. Earnings per share declined 3% year-over-year to $1.26 on a non-GAAP basis, which is several cents better than consensus estimates. Free cash flow was very solid at $433 million, equivalent to 36% of total revenue. Baidu’s core search business is growing at rates we saw from Best Idea Newsletter portfolio holding Google (click ticker for report: ) in its earlier days as Chinese internet usage continues to grow. Baidu … Read more

Shares of Baidu Are Just Too Cheap

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Valuations for internet technology companies are literally all over the place. On one end of the spectrum sits LinkedIn (click ticker for report: ) and Amazon (click ticker for report: )—fast growing firms with sky-high PE multiples and tremendous credit given to the long-run. On the other end, we have Apple (click ticker for report: ) generating fantastic amounts of free cash flow, and trading with a single-digits forward PE. Chinese search giant Baidu (click ticker for report: ) falls closer to Apple, and we think shares look incredibly cheap at current levels. Let’s take a closer look at the search giant. Valuation Baidu’s valuation on a discounted cash flow basis looks extremely reasonable. We estimate shares to be worth … Read more

Chinese Stocks Take a Pounding

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The DOJ is stepping in to investigate accounting irregularities at US-listed Chinese firms. Though we fall short of concluding that any wrongdoing has occurred across our Chinese equity coverage universe, we think such negative news adds a layer of uncertainty to the group that won’t be assuaged anytime soon. The Guardian reported: “There are parts of the Justice Department that are actively engaged in this area,” said Robert Khuzami, director of enforcement at the U.S. Securities and Exchange Commission. “I think that you will see greater (Department of Justice) involvement as time goes on,” said Khuzami, a former federal prosecutor himself, when asked why no criminal charges have yet been filed in the massive Chinese accounting scandal. “Not having proper accounting … Read more