Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

Equity Bottom-Up

<ul><li>Baidu is intensifying its AI initiatives with the launch of ERNIE 4.5 Turbo and ERNIE X1 Turbo, aiming to solidify its position in China's competitive AI landscape.</li><li>These models boast enhanced multimodal capabilities and are priced significantly lower than competitors, with ERNIE 4.5 Turbo costing just 1% of GPT-4.5's price.</li><li>In a strategic shift, Baidu plans to open-source ERNIE 4.5 by June 30, 2025, and has made its ERNIE Bot free for individual users.</li></ul>

Baidu is intensifying its AI initiatives with the launch of ERNIE 4.5 Turbo and ERNIE X1 Turbo, aiming to solidify its position in China's competitive AI landscape.These models boast enhanced multimodal capabilities and are priced significantly lower than competitors, with ERNIE 4.5 Turbo costing just 1% of GPT-4.5's price.In a strategic shift, Baidu plans to open-source ERNIE 4.5 by June 30, 2025, and has made its ERNIE Bot free for individual users.

Baidu’s AI Shake-Up: Can ERNIE 4.5 Turbo Outmaneuver DeepSeek & Alibaba?

Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

<ul>
<li>We conducted a drill exercise in which BIDU's search revenue will shrink to 1/3 of its size while its AI cloud</li>
<li>Our key concern is margin compression as search's high margin as a result of browser infrastructure and monopolistic status aren't repeatable in AI;</li>
<li>We raise the TP from US$80.0 to US$92.5 and maintain SELL.</li>
</ul>


We conducted a drill exercise in which BIDU's search revenue will shrink to 1/3 of its size while its AI cloud
Our key concern is margin compression as search's high margin as a result of browser infrastructure and monopolistic status aren't repeatable in AI;
We raise the TP from US$80.0 to US$92.5 and maintain SELL.


[Baidu, Inc. (BIDU US, SELL, TP US$92.5) TP Change]: What Can Change BIDU from SELL to a BUY?

<ul><li>Baidu's fourth-quarter and full-year 2024 financial results reveal a company navigating both challenges and opportunities, driven by its ongoing transformation into an AI-centric entity.</li><li>The reported total revenues for the fourth quarter amounted to RMB 34.1 billion, a 2% decrease year-over-year, while full-year revenues were down by 1%, at RMB 133.1 billion.</li><li>Despite these slight declines, Baidu Core's revenue performance was stable, increasing by 1% for both the fourth quarter and full year.</li></ul>

Baidu's fourth-quarter and full-year 2024 financial results reveal a company navigating both challenges and opportunities, driven by its ongoing transformation into an AI-centric entity.The reported total revenues for the fourth quarter amounted to RMB 34.1 billion, a 2% decrease year-over-year, while full-year revenues were down by 1%, at RMB 133.1 billion.Despite these slight declines, Baidu Core's revenue performance was stable, increasing by 1% for both the fourth quarter and full year.

Baidu Inc.: When Will Its Efforts Towards Generative AI

<ul>
<li>BIDU reported C4Q24 top line, non-GAAP op. profit and GAAP net income in-line, (22%) and (7.0%) vs. our est. and (3.7%), (24%) and in line vs. cons. </li>
<li>While monetization on a largely in-house app repertoire can ensure AI revenue to start kicking in in C2H25, we are concerned on the size of this revenue, </li>
<li>We maintain our SELL but raise TP to US$80 to reflect a short-term trading opportunity around AI monetization.</li>
</ul>


BIDU reported C4Q24 top line, non-GAAP op. profit and GAAP net income in-line, (22%) and (7.0%) vs. our est. and (3.7%), (24%) and in line vs. cons. 
While monetization on a largely in-house app repertoire can ensure AI revenue to start kicking in in C2H25, we are concerned on the size of this revenue, 
We maintain our SELL but raise TP to US$80 to reflect a short-term trading opportunity around AI monetization.


[Baidu, Inc. (BIDU US, SELL, TP US$80) TP Change]: AI Monetization by How Much & At What Cost?

<ul>
<li>We expect BIDU to post C4Q24 top line,non-GAAP operating profit and GAAP net income (5.1%), (7.7%) and (8.7%) vs. consensus.We expect BIDU to issue C1Q25 top line guidance (1.2%) vs.consensus;</li>
<li>BIDU's problem is not only manifested in the loss of the Apple contract,it is also the loss of first mover advantage in both Generative Artificial Intelligence and Autonomous Driving Services. </li>
<li>Losing traffic advantage, BIDU has become a self-containing app ecosystem but all pillars of this ecosystem is facing intensifying competition. SELL @US$78.</li>
</ul>


We expect BIDU to post C4Q24 top line,non-GAAP operating profit and GAAP net income (5.1%), (7.7%) and (8.7%) vs. consensus.We expect BIDU to issue C1Q25 top line guidance (1.2%) vs.consensus;
BIDU's problem is not only manifested in the loss of the Apple contract,it is also the loss of first mover advantage in both Generative Artificial Intelligence and Autonomous Driving Services. 
Losing traffic advantage, BIDU has become a self-containing app ecosystem but all pillars of this ecosystem is facing intensifying competition. SELL @US$78.


[Baidu, Inc. (BIDU US, SELL, TP US$78) Preview]: Baidu’s Problem Is Deep Rooted and Getting Worse

China

Baidu, Inc. operates an Internet search engine. The Company offers algorithmic search, enterprise search, news, MP3, and image searches, voice assistance, online storage, and navigation services. Baidu serves clients globally.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Baidu (BIDU US)

Baidu’s AI Shake-Up: Can ERNIE 4.5 Turbo Outmaneuver DeepSeek & Alibaba?

Baidu is intensifying its AI initiatives with the launch of ERNIE 4.5 Turbo and ERNIE X1 Turbo, aiming to solidify its position in China's...

Baptista Research

[Baidu, Inc. (BIDU US, SELL, TP US$92.5) TP Change]: What Can Change BIDU from SELL to a BUY?

Concerns about margin compression for BIDU due to shrinking search revenue and the unreliability of high margins in AI lead to a maintained SELL...

Blue Lotus Research Institute

Baidu Inc.: When Will Its Efforts Towards Generative AI

Baidu's fourth-quarter and full-year 2024 financial results reveal a company navigating both challenges and opportunities, driven by its ongoing...

Baptista Research

[Baidu, Inc. (BIDU US, SELL, TP US$80) TP Change]: AI Monetization by How Much & At What Cost?

BIDU reports in-line financials for Q4, concerns remain on AI revenue potential, analysts maintain SELL rating but raise price target to $80.

Blue Lotus Research Institute

[Baidu, Inc. (BIDU US, SELL, TP US$78) Preview]: Baidu’s Problem Is Deep Rooted and Getting Worse

BIDU faces challenges with loss of Apple contract and first mover advantage in AI and autonomous driving, leading to intensifying competition and...

Blue Lotus Research Institute

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Baidu’s AI Shake-Up: Can ERNIE 4.5 Turbo Outmaneuver DeepSeek & Alibaba?

Baidu is intensifying its AI initiatives with the launch of ERNIE 4.5 Turbo and ERNIE X1 Turbo, aiming to solidify its position in China's...

Baptista Research

[Baidu, Inc. (BIDU US, SELL, TP US$92.5) TP Change]: What Can Change BIDU from SELL to a BUY?

​Concerns about margin compression for BIDU due to shrinking search revenue and the unreliability of high margins in AI lead to a maintained SELL...

Blue Lotus Research Institute

Baidu Inc.: When Will Its Efforts Towards Generative AI

Baidu's fourth-quarter and full-year 2024 financial results reveal a company navigating both challenges and opportunities, driven by its ongoing...

Baptista Research

[Baidu, Inc. (BIDU US, SELL, TP US$80) TP Change]: AI Monetization by How Much & At What Cost?

​BIDU reports in-line financials for Q4, concerns remain on AI revenue potential, analysts maintain SELL rating but raise price target to $80.

Blue Lotus Research Institute

[Baidu, Inc. (BIDU US, SELL, TP US$78) Preview]: Baidu’s Problem Is Deep Rooted and Getting Worse

​BIDU faces challenges with loss of Apple contract and first mover advantage in AI and autonomous driving, leading to intensifying competition and...

Blue Lotus Research Institute

Concerns about margin compression for BIDU due to shrinking search revenue and the unreliability of high margins in AI lead to a maintained SELL...

BIDU reports in-line financials for Q4, concerns remain on AI revenue potential, analysts maintain SELL rating but raise price target to $80.

BIDU faces challenges with loss of Apple contract and first mover advantage in AI and autonomous driving, leading to intensifying competition and...