Baidu Stumbles as Competitors Rise (BIDU, SINA, SOHU, YOKU)

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By Trey Thoelcke Published
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While Chinese Internet search company Baidu Inc. (NASDAQ: BIDU) slipped in early trading, its competitors Sohu.com Inc. (NASDAQ: SOHU), SINA Corp. (NASDAQ: SINA) and Youku Tudou Inc. (NYSE: YOKU) all surged after the opening bell.

As we mentioned earlier this morning, Baidu has been a disappointment for investors. While sales and profits continue to ramp up impressively, Baidu shares have dropped to near a 52-week low. Over the past year, its shares are off more than 24%, while those of U.S.-based search company Google Inc. (NASDAQ: GOOG) are 30% higher over the same period.

Baidu has up to 80% of the Chinese search market, and it is said to be protected by the Chinese government, which has hampered Google’s efforts operate in the People’s Republic. Baidu’s revenue rose 60% in the second quarter to $859 million. Its operating profits rose 52% to $443 million.

And Baidu said it plans to diversify into other markets. Japan was supposed to the first of these, but so far there is little evidence of success there. Baidu does not have the capital to make necessary investments to expand beyond China.

Baidu is down more than 2% in morning trading to $107.11, in a 52-week range of $99.71 to $154.15. Sohu is up about 5% to $43.13, SINA up about 2% to $42.62 and Youku up more than 7% to $19.16. This morning, a Citigroup (NYSE: C) analyst named Yoku a top Internet pick.

Photo of Trey Thoelcke
About the Author Trey Thoelcke →

Trey has been an editor and author at 24/7 Wall St. for more than a decade, where he has published thousands of articles analyzing corporate earnings, dividend stocks, short interest, insider buying, private equity, and market trends. His comprehensive coverage spans the full spectrum of financial markets, from blue-chip stalwarts to emerging growth companies.

Beyond 24/7 Wall St., Trey has created and edited financial content for Benzinga and AOL's BloggingStocks, contributing additional hundreds of articles to the investment community. He previously oversaw the 24/7 Climate Insights site, managing editorial operations and content strategy, and currently oversees and creates content for My Investing News.

Trey's editorial expertise extends across multiple publishing environments. He served as production editor at Dearborn Financial Publishing and development editor at Kaplan, where he helped shape financial education materials. Earlier in his career, he worked as a writer-producer at SVE. His freelance editing portfolio includes work for prestigious clients such as Sage Publications, Rand McNally, the Institute for Supply Management, the American Library Association, Eggplant Literary Productions, and Spiegel.

Outside of financial journalism, Trey writes fiction and has been an active member of the writing community for years, overseeing a long-running critique group and moderating workshop sessions at regional conventions. He lives with his family in an old house in the Midwest.

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