Strength Seen in Baidu Inc. (BIDU): Can Its 9.1% Jump Turn into More Strength?
Baidu Inc. (BIDU) shares ended the last trading session 9.1% higher at $102.56. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 14.2% gain over the past four weeks.
Baidu extended its rally, driven by the latest stimulus measures announced by the People’s Bank of China to boost the troubled domestic economy of China. The measures include interest rates cut which would reduce borrowing costs and prevent scores of debt-laden property owners. Secondly, central bank will ease restrictions on borrowing to invest in stocks and shares on Chinese exchanges.
This web search company is expected to post quarterly earnings of $2.73 per share in its upcoming report, which represents a year-over-year change of -2.5%. Revenues are expected to be $4.84 billion, up 2.5% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Baidu Inc., the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on BIDU going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Baidu Inc. is part of the Zacks Internet - Services industry. Uber Technologies (UBER), another stock in the same industry, closed the last trading session 0.6% lower at $76.69. UBER has returned 7.4% in the past month.
For Uber , the consensus EPS estimate for the upcoming report has changed +3.5% over the past month to $0.41. This represents a change of +310% from what the company reported a year ago. Uber currently has a Zacks Rank of #3 (Hold).
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