Baidu Stock: Ride the Cloud to Profits
David Moadel
May 31, 2022
Story Highlights
While certainly not perfect, Baidu’s recently released financial figures beat Wall Street’s expectations and analysts are cheering. So, despite China’s challenges, Baidu stock looks like a buy as the company delivers strong cloud and artificial-intelligence segment results.
Beijing-headquartered Baidu ( BIDU) provides artificial intelligence (AI), cloud, and Internet search services in China. I am bullish on the stock.
There’s no denying it, investing in Chinese technology businesses has been a challenge. The nation’s crackdown on tech-related businesses, based on security concerns, has been well documented. This factor could cause some traders to avoid Baidu stock, based on fear that Baidu can’t thrive in this restrictive environment.
On top of that, some investors may be worried about restrictions in China due to the COVID-19 pandemic. This is a valid concern, so Baidu’s financial results should be monitored carefully. Prospective investors can check to see if Baidu managed to mitigate its losses, or even showed improvement in its crucial segments. These include Baidu’s Core (search engine/ad revenue/marketing) segment as well as the company’s sometimes overlooked AI Cloud business.
At the end of the day, it’s fine to be concerned about China-based businesses due to security crackdowns and the COVID-19 pandemic’s resurgence. This doesn’t mean that you have to shun a perfectly viable investment opportunity in a top-tier tech giant like Baidu.
On TipRanks, Baidu’s key metrics have resulted in a Smart Score of 10, indicating that the stock is capable of outperforming the broader market.
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