- Baidu, Inc BIDU reported a second quarter FY22 revenue down 5% year over year to $4.43 billion, beating consensus.
- Baidu’s non-GAAP earnings per ADS of $2.36 beat the consensus.
- Mizuho Analyst James Lee repeated a purchase and target price of $275.
- Results came in ahead of expectations despite the macroeconomic impact and COVID lockdowns, with cloud outperforming on revenue growth of 31% year over year.
- Lee believes the quarter validates Baidu’s upfront investments in digital transformation for traditional sectors, autonomous driving in connected infrastructure, and OEM solutions.
- At the same time, management focused on margins, beating expectations by five percentage points, reflecting increased cost efficiencies.
- With signs of continued recovery in 2H22, it is confident in its FY24 EBITDA of RMB 38.5 billion and keeps BIDU as the top pick in China Internet.
- Lee sees the stock as attractive and sees its cloud and autonomous driving opportunities as “call options.”
- city Analyst Alicia Yap cut the price target to $204 from $223 and reiterated a buy.
- The company delivered a “solid” Q2 with relatively flat overall revenue, while non-GAAP operating income came in stronger than expected thanks to efficient cost optimization efforts, Yap noted.
- Baidu remains well-positioned to “drive the digitization of the industrial internet, city urbanization initiatives and the goal of carbon neutrality,” he added.
- Price promotion: BIDU shares traded 5.35% higher to $145.06 on the last check Wednesday.
- Photo via Wikimedia Commons
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
[ad_2]
Source story
