U.S. bond and equity markets are closed Monday in observance of President’s Day.
Six of 11 market sectors closed higher Friday, but two of the three major indexes closed lower. Energy (down 3.65%) and technology (down 1.19%) gave up the most. Consumer staples (up 1.29%) and utilities (up 1%) posted the best gains. The Dow closed up 0.39%, the S&P 500 closed down 0.28%, and the Nasdaq Composite closed down 0.58%. Two-year Treasuries closed down 2 basis points at 4.6%, and 10-year notes slipped by 4 basis points to close at 3.82%. Oil traded down about 2.2% Friday and traded down up by 0.65% early Monday morning at $76.78.
Thursday’s trading volume was slightly above the five-day average, and NYSE losers outpaced winners by 1,713 to 1,309, while Nasdaq advancers led decliners by about 11 to 10.
Before U.S. markets open Tuesday morning, Home Depot, Teck Resources, and Walmart will report quarterly results. Here’s our preview. Coinbase, Palo Alto Networks, and Transocean will report results after U.S. markets close Tuesday afternoon.
These three companies are set to report results before markets open Wednesday morning.
Beijing-based Baidu Inc. (NASDAQ: BIDU) is China’s premier search engine and like its U.S. counterparts, is working on an artificial intelligence project similar to OpenAI’s ChatGPT, Microsoft’s Bing Chat, and Google’s Bard. Baidu’s entry is slated to be a chatbot called Ernie, and the company is expected to release more details this week on how it plans to integrate the chatbot into its search engine, automobile technology, and smart assistants. Baidu’s stock has added about 24% since the beginning of the year.
Of 37 brokerages covering the stock, 30 have a Buy or Strong Buy rating on the shares, and the other 7 rate the stock a Hold. At a current price of around $142.00, the stock’s upside potential based on a median price target of $173.37 is about 22.1%. At a high price target of $231.60, the upside potential is 63.1%.
Analysts expect Baidu to post fourth-quarter revenue of $4.63 billion, a sequential increase of 1.3% and a decline of 11.1% year over year. Adjusted earnings per share (EPS) are forecast at $2.06, down 13.2% sequentially and up 12.6% year over year. For the full 2022 fiscal year, the consensus estimate calls for EPS of $8.38, down 0.5% year over year, and revenue of $17.91 billion, down 8.6%.
The company’s stock trades at a multiple of 16.9 times expected 2022 EPS, 15.1 times estimated 2023 earnings of $9.38, and 13 times estimated 2024 earnings of $10.90 per share. The stock’s 52-week range is $73.58 to $170.35. Baidu does not pay a dividend and total shareholder return for the past year was negative 14.84%.
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