Market Overview

UPDATE: Credit Suisse Downgrades Baidu to Underperform on Competition Concerns

Related BIDU
What to Expect When You're Expecting: Alibaba Group Holding Ltd
Fast Money Picks For September 18 - Metlife Inc, CME Group Inc And More

Credit Suisse lowered its rating on Baidu (NASDAQ: BIDU) from Neutral to Underperform and lowered its price target from $118 to $83.

Credit Suisse commented, "Baidu is facing multiple challenges: (1) a weaker-than-expected advertising market; (2) intensifying competition from new entrants; and (3) difficulty to monetise mobile search traffic. We believe rising competition, particularly from Qihoo, will lead to: (1) a lower market share, as advertisers will use the competitors' keyword prices as reference; and (2) lower margin, as Baidu will need to pay higher salaries to keep top engineers and needs a higher traffic acquisition cost (percentage of revenue), as competitors will try to cooperate with Baidu's third-party websites. Separately, according to industry sources, mobile search accounted for 30%+ of Baidu's traffic which is likely to rise to 50% in 3Q13. But the company generates only 2–3% of total revenue from mobile search."

Baidu closed at $114.29 on Monday.

Latest Ratings for BIDU

DateFirmActionFromTo
Jul 2014BNP ParibasUpgradesReduceBuy
Jul 2014HSBCMaintainsOverweight
Jul 2014UBSMaintainsNeutral

View More Analyst Ratings for BIDU
View the Latest Analyst Ratings

Posted-In: Credit SuisseAnalyst Color Downgrades Pre-Market Outlook Analyst Ratings

 

Related Articles (BIDU)

Around the Web, We're Loving...

Partner Network

Get Benzinga's Newsletters