Baidu Inc (NASDAQ: BIDU) is having a rough day in the market today, and for good reason. The company announced its earnings for the fourth quarter. While growth was positive, outlook showed some concerns.
The upsetting outlook for the first quarter led to the declines that we’re seeing today. Below, we’ll talk about:
- The company’s results and outlook;
- what we’re seeing from BIDU stock as a result; and
- what we’ll be watching for ahead.
BIDU Announces Earnings And Outlook
Baidu hasn’t been a favorite among investors as of late, and things got worse today after the company reported its fourth quarter results. All told, the results of the quarter were positive. The concern however, is the future.
During the fourth quarter, BIDU said that its revenue rose to about $3.96 billion. That works out to a gain of 22%. The figure far outpaced expectations of growth to come between 15% and 20%.
The growth proved to be impressive, not just because of the numbers hit, but because the flagship online search business saw slowing. In fact, the online search business slowed to just a 14% advance.
Unfortunately, it seems as though the slowing growth is going to continue. In the current quarter, BIDU said that it is expecting for revenue growth to slow to growth of between 12% and 18%.
While this may be a ploy to set expectations low and beat them, becoming the darling child it once was, the news upset investors.
What We’re Seeing From The Stock
One of the first lessons that we learn as investors is that the news moves the market. When it comes to Baidu, the news proved to be mixed. While the performance in the fourth quarter was positive, concerns about slowing growth are hitting home for the stock.
Considering this, it’s not shocking that we’re seeing declines in the stock today. As is normally the case, our partners at Trade Ideas were the first to alert us to the movement. Currently (11:01), BIDU is trading at $165.93 per share after a loss of $5.88 per share or 3.42% thus far today.
Stop wasting your time! Start finding winning trades in minutes with Trade Ideas!
What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on BIDU. In particular, we’re interested in seeing if the company beats the lowered growth expectations for the current quarter. If this is the case, we could see meaningful gains ahead. Nonetheless, we’ll continue to follow the story and bring the news to you as it breaks.
Never Miss The News Again
Do you want real-time, actionable news delivered to your inbox? Join the CNA Finance mailing list below!