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Baidu trading at discount to US competitor Alphabet for first time in 5-years

Sep 12, 2018

  • Baidu (BIDU) is trading at a 10.62% discount to Alphabet Inc. (GOOGL) on an NTM P/E basis, marking the first time Baidu is at a discount to Alphabet since July 2013. 
  • On 08/01/18, Baidu’s NTM P/E dropped 10.21% from 23.18x to 20.80x. 
  • Consensus forecasts EPS growth of 16.05% per annum for Baidu while Alphabet's EPS is expected to grow 18.68% per annum.
  • Baidu’s NTM P/E of 19.30x is its four-year low while Alphabet’s 21.35x is on par with its historical range. 
  • Despite trading at a discount, Baidu maintains a healthy return on equity of 17.10% compared to Alphabet’s 10.50%. 
  • Baidu’s EBITDA margin of 33.80% is also more attractive to Alphabet’s 30.80%. 
  • Baidu is rated as ‘attractive’ in our China All-Cap Global Top Picks. 
  • Alphabet is rated as ‘neutral’ in our US Large-Cap Global Top Picks and ‘attractive’ in our US Information Technology Global Top Picks. 

 

Alphabet (GOOGL) vs. Baidu (BIDU) 4-Year NTM P/E


Source: Bloomberg

GOOGL/BIDU 4-Year NTM P/E Ratio


Source: Bloomberg