JP Morgan Chase hopeful about the long-term prospects for Baidu

JP Morgan analyst Weddigen (Dick Wei) Investment Report published today that a stable macroeconomic environment in China will support further growth in the performance of Baidu, Baidu long-term growth prospects. Following is the summary of the report:

Baidu first quarter 2009 revenues of 810.7 million yuan (about 118.6 million U.S. dollars), down more than 10 percent Central, an increase of 41%, higher than analyst expectations of 115.2 million U.S. dollars; diluted earnings per share of 0.76 U.S. dollars, chain down 37.3% year-on-year increase of 26.9%, in line with analyst expectations.

Baidu anticipates income in 2009 for the second quarter from 157,000,000 to 161,000,000 U.S. dollars, analysts anticipated for the 144.1 million U.S. dollars, we anticipate that for the 157.8 million U.S. dollars. We anticipate Baidu in the second quarter the number of customers and mean income per client will be higher than the first quarter. We anticipate the intermediate period, a steady household macroeconomic natural environment and a good come back on buying into in 2009 will support the development of Baidu performance.

Baidu first quarter of 2009, traffic acquisition charges accounted for 15.3 per hundred of total incomes, at a high level. We changed the traffic acquisition charges of long-term anticipations, Baidu Union constituents to boost Web location traffic will have a affirmative influence on the presentation of Baidu.

We are confident about the long-term prospects for Baidu, the justifications include: 1) The Chinese explore market is still at an early stage of development, Baidu is China’s primary explore company; 2) phoenix nest on Baidu is far bigger than a optimistic consequence on the recital of a opposing impact; 3) Baidu will enhance R & D and enhance efficiency; 4) Baidu is still in the search of long-term enterprise chances, for instance the C2C.

Baidu PEG (earnings family member returns expansion ratio) of 1-fold, taking into account the expansion of the Chinese netizens as well as the explore promulgating market is still at an early stage of development, we trust that this diagram is reasonable. Chao-feng and the distribute of China’s in the household macroeconomic surroundings will have a optimistic consequence on Baidu shares.