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Can Growing Partnerships Drive Baidu's (BIDU) Q2 Earnings?

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Baidu, Inc. (BIDU - Free Report) is scheduled to report second-quarter 2018 results on Jul 31.

The company topped the Zacks Consensus Estimate in the trailing four quarters, with an average positive earnings surprise of 51.5%.

In the last reported quarter, Baidu delivered a positive earnings surprise of 50.3%. Earnings of $2.60 per share grew 14% sequentially.

Revenues increased 31% year over year to $3.33 billion. The figure also surpassed the Zacks Consensus Estimate of $3.26 billion. Mobile revenues represented 78% of total net revenues compared with 70% in the year-ago period.

We observe that shares of Baidu have gained 29.5% in the past 12 months against the industry’s 12.5% rally.

Product Portfolio & Partnerships to Drive Results

Baidu’s continuous efforts to strengthen its mobile search engine and AI technologies are likely to drive top-line growth. Strong focus on leveraging the AI platform is aiding to provide an improved user experience.

Recently, Baidu teamed up with Analog Devices to develop new technologies for sensing and navigation applications such as radar and lidar for Project Apollo. The deal will provide innovative and reliable solutions to address the needs of autonomous driving, and intelligent connectivity, taking full care of the safety system.

In June, Baidu collaborated with Ford Motor Company to co-develop artificial intelligence (AI) and connectivity solutions for Ford’s vehicles in China.

Hence, we believe Baidu’s strong focus on product innovation and expansion is likely to favorsecond-quarter results.

What Our Model Says

Currently, Baidu has a Zacks Rank #4 (Sell) and an Earnings ESP of positive 5.16%, a combination that makes surprise prediction difficult. This is because per our proven model, a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to beat estimates. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

We don’t recommend Sell-rated stocks (Zacks Rank #4 or 5) going into the earnings announcement.

Baidu, Inc. Price and EPS Surprise

 

Baidu, Inc. Price and EPS Surprise | Baidu, Inc. Quote

Stocks to Consider

Here are some stocks that you may want to consider, as our model shows that these have the right combination of elements to deliver a positive earnings surprise.

AMETEK (AME - Free Report) has an Earnings ESP of +0.43% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Agilent Technologies (A - Free Report) has an Earnings ESP of +0.88% and a Zacks Rank #3.

Fortive Corporation (FTV - Free Report) has an Earnings ESP of +0.84 and a Zacks Rank #3.

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Fortive Corporation (FTV) - free report >>

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