Stocks: (YHOO)(EBAY)(AMZN)(BIDU)(SOHU)(TOMO)
From mid-2002 to early 2004, old-line US internet stocks posted huge gains.
Yahoo! went from under $10 to $35. Amazon went from under $10 to $57. Ebay rose from $15 to nearly $50. Most of those increases have been cut roughly in half.
Now, it’s China’s turn. On the strength of the growing number of internet users and a recently upgrade of Chinese internet stocks by CIBC World Markets the web stocks in the world’s most populated country are off to the races. Today, Baidu is up 10%. Sohu.com and Tom Online are up about 5%. To quote MarketWatch: "CIBC World Markets analsyt Paul Keung predicted spending on search advertising in China will rise to 20% of a typical Chinese company’s marketing budget in a year."
Up and up, but maybe too much. In the last year Baidu’s stock has gone from $44 to its current $122, just below its 52-week low. Sohu’s run from $18.20 to $25.17 is less impressive, but still a good showing. Tom Online has gone from a 52-week low of $8.83 to $16.19. That is still below its one year high of $28.89, but it’s a double nonetheless.
According to MarketWatch stats, Baidu has a P/E of 395, so, at some point soon, these stocks get to be pricey.
Very.
Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writes about.
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