On Friday, Deutsche Bank upgraded shares of Baidu BIDU from Hold to Buy and raised the price target from $178 to $229.
The stock is flat in Friday's trading to$160 after spiking to as high as $172.42 in Thursday's post market trading after the company reported first quarter earnings and offered second quarter guidance.
Analyst Alan Hellawell believes the market has “underestimated BIDU's viability and is overly conservative on its growth/earnings outlook.” Baidu should not trade at a “significant discount” versus peers, according to the analyst.
Hellawell is encouraged by Baidu's PC organic traffic, which is “more resilient than expected, and raised 2Q14E revenues from owned PC traffic by 14 percent and acquired PC traffic by 5 percent as:
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