BAIDU

Analysis of Baidu share price

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In this article, you will discover the elements you will need to carry out a good analysis of the Baidu share price. In particular, we will focus on the fundamental analysis of this stock with the elements likely to influence its price, the company itself with its specific activities, its main competitors, its recent partnerships and its main strengths and weaknesses. Finally, we will also offer you some basic stock market data about the stock.

Elements that can influence the price of this asset:

Analysis N°1

First, Baidu's market share on the Chinese domestic market will be monitored.

Analysis N°2

Although local competitors are few in number, they will still be closely monitored to identify players that may cause it to lose market share.

Analysis N°3

We will keep an even closer eye on the international giants in this sector of activity who are trying to establish themselves on the Chinese market on a long-term basis, such as Google or Yahoo.

Analysis N°4

Baidu's development of new IT infrastructure to improve Internet access rates is also an important consideration.

Analysis N°5

The decisions made by the government that regularly intervenes in the management of Baidu are also very important data that you must take into account in your fundamental analyses of this value.

Analysis N°6

Finally, and given that this company operates in a highly technological sector, the group's investments in research and development and the strategic partnerships it has established will also be monitored.

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General presentation of Baidu

It is of course essential that you have a very good knowledge of Baidu before you start trading its shares on the stock market. Therefore, we are now offering you a detailed presentation of this group with its main activities and the breakdown of its sources of income.

Baidu Group Inc. is a Chinese company listed on the NASDAQ market. It is even China's leading Internet search engine. The site of this company integrates features such as definition, translation into English, downloading of videos or images and other functionalities.

In order to better understand the activities of this company, it is possible to divide them into different categories according to the share of turnover they generate and in this way :

  • Sales of marketing services represent the largest share of the group's revenues with 71.9% of turnover.
  • The remaining 28.1% of sales, or 28.1%, came from other services, including the sale of research software licenses.
Analysis of Baidu share price
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The major competitors of Baidu

Now that you are more familiar with Baidu, it is time to take a more global look at the company's sector of activity with a presentation of its main competitors on the Chinese market.

NetEase

This company is another Chinese company specialized in the Internet sector. It operates the 163.com site, which is one of the most popular web portals in the country.

Tencent Holdings Limited 

Tencent, which has been in existence since 1998, also specialises in Internet services, mobile services and online advertising. It is based in Shenzhen, China. The company's services include social networks, web portals, e-commerce portals and multiplayer online games. The group also operates the Tencent QQ instant messaging service which operates one of China's largest web portals, QQ.com and the WeChat instant messaging application.

Alibaba 

 Although this company seems to have different activities from Baidu, it is nevertheless one of the Internet giants in China. Listed on the stock exchange, Alibaba generates revenues from various online activities including a marketplace for business-to-business exchanges, payment and retail platforms, as well as a search engine for shopping and cloud computing services.

Renren

This company, whose name means "everyone" in French, is a Chinese social network that is also listed on the stock exchange since May 2011. It was formerly known as Xiaonei and took on this new name in 2009 with the creation of the Renren.com website.

Sohu

Finally, Baidu's last major competitor in China is Sohu, which is another Chinese internet company but also the name given to one of the country's main websites.


The major partners of Baidu

After going around Baidu's various opponents, we suggest you discover some of his strategic allies. Indeed, the group often sets up international partnerships in order to promote its growth and here are some recent examples:

BMW 

The first partnership we're going to talk about here was signed in 2019 with BMW. The two companies signed a memorandum of understanding whereby BMW will join Apollo, an open autonomous driving platform created by Baidu, as a member of the board of directors. This is not the first partnership agreement between Baidu and BMW in the field of autonomous driving. The two companies have started working together to provide safe, convenient and intelligent mobility experiences for Chinese consumers.

Microsoft 

Previously, in 2011, it was with the American giant Microsoft and its search engine Bing that Baidu had set up a strategic partnership. The goal was for Microsoft to increase its presence in China, which represented and still represents today a lucrative and large scale market with its 450 million Internet users.

Valeo

Finally, the last partnership that we will discuss here is the one set up with Valeo in 2018. This strategic cooperation once again concerns the Apollo collaborative platform for the autonomous car, which was created by the Chinese giant. Within the framework of this partnership, Valeo will contribute its expertise in sensors as the international leader in this segment. The French automaker has the most comprehensive sensor range on the market with cameras, radars, ultrasonic sensors and the Valeo Scala laser scanner. Thanks to its equipment and knowledge, Valeo has already achieved several world firsts with autonomous vehicles such as the 24 hours of the Paris ring road, the Tour of Europe or the Tour of the United States. Valeo will also contribute its expertise in sensor cleaning systems which are essential to the optimal operation of sensors in terms of connectivity between autonomous vehicles and in terms of monitoring and optimizing cabin air quality.

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The factors in favour of a rise in the Baidu share price:

We now offer you the opportunity to find out the pros and cons of Baidu stocks before you decide on a strategy to trade this stock. To do so, it is indeed necessary to analyze the strengths and weaknesses of this company, which are detailed below.

Let's start with a reminder of the strengths of this company:

  • First of all, we know that the Baidu Group has a strong brand image and a very positive reputation with the Chinese public.
  • The fact that Baidu is currently the leader in the Internet search segment in China is also a positive point, especially since it is also present in Japan, Thailand, Egypt and India.
  • The group's management team is another of its strengths and is indeed both solid and efficient.
  • The group is also the first company in the country to be listed on the NASDAQ 100 index.
  • Finally, we also appreciate the strong R&D investment in artificial intelligence and the solid revenue model derived from online advertising.
The factors in favour of a drop in the Baidu share price:

With regard to the main weaknesses of this undertaking, the following points should be noted:

- Although Baidu is the leader of its sector in China, its brand recall internationally is still weak with less advertising activity than its competitors.

The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions.

Frequently Asked Questions

Why is Baidu listed on the NASDAQ 100 stock index?

Given that the Baidu Group is a Chinese company, one might wonder why it is included in the composition of the US NASDAQ 100 stock market index. In fact, this is because the NASDAQ index does not only include US stocks, but also the world's largest technology companies, including, of course, the Chinese giant Baidu.

Can you trade Baidu shares online?

Like many other international shares issued by companies with very large capitalizations, Baidu shares are available on certain online trading platforms. It is therefore possible to speculate on the rise or fall of their price directly from such a platform and using CFDs or contracts for difference, offered by approved brokers.

How to make a technical analysis of the Baidu share price?

Technical analysis, which complements fundamental analysis, is an essential method for any Baidu share strategy. You can carry out this analysis from the customizable charts provided by your broker, displaying trend or volatility indicators as well as the various market turning points.

72% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. Trade CFDs with Plus500