Baidu Inc

09888: XHKG (HKG)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	HK$387.00	Rqcwh	Qkvrbhjd

Baidu: Lowering Fair Value by 5% Over Macro Headwinds Affecting Ad Business; Cloud Still Strong

Kai Wang

Apr 30, 2024

We are lowering our Baidu fair value estimate by 5% to USD 174 (HKD 171) per share from USD 183 (HKD 180), after lowering our annual revenue growth assumptions for Baidu’s advertising business to 4%-5% from 6% in 2025-29 as macroeconomic headwinds continue to mount. Previously, wide-moat Baidu indicated that the slow growth rate in the fourth quarter of 2023 was only temporary, with recovery expected in 2024, but we now believe visibility will be limited this year.

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