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Why Baidu Inc. (BIDU) Outpaced the Stock Market Today

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In the latest market close, Baidu Inc. (BIDU - Free Report) reached $103.50, with a +0.44% movement compared to the previous day. The stock's performance was ahead of the S&P 500's daily gain of 0.15%. On the other hand, the Dow registered a loss of 0.02%, and the technology-centric Nasdaq increased by 0.32%.

Prior to today's trading, shares of the web search company had gained 1.74% over the past month. This has outpaced the Computer and Technology sector's gain of 1.32% and the S&P 500's gain of 1.65% in that time.

The investment community will be paying close attention to the earnings performance of Baidu Inc. in its upcoming release. The company is expected to report EPS of $3.20, up 36.75% from the prior-year quarter. At the same time, our most recent consensus estimate is projecting a revenue of $4.56 billion, reflecting a 0.56% rise from the equivalent quarter last year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $12.95 per share and revenue of $20.37 billion, which would represent changes of +13.7% and +7.92%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Baidu Inc. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Baidu Inc. currently has a Zacks Rank of #4 (Sell).

Valuation is also important, so investors should note that Baidu Inc. has a Forward P/E ratio of 7.96 right now. Its industry sports an average Forward P/E of 23.05, so one might conclude that Baidu Inc. is trading at a discount comparatively.

The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 71, putting it in the top 29% of all 250+ industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.

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