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<Research>UBS Trims TP of Baidu (BIDU.US) to US$165; Margin Beats but Ads Outlook Weak
Recommend 5 Positive 14 Negative 2 |
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UBS noted in a report that Baidu (BIDU.US)'s 1Q24 results have beaten market forecasts, with core revenue reaching RMB23.8 billion, beating by 0.7%. Core non-GAAP operating margin was 23.5%, surpassing broker and consensus forecasts by 2 and 1.7 ppts respectively. UBS said investors remain focused on Baidu's core advertising market outlook and shareholder returns as key price drivers. With recent macroeconomic pressures on the advertising outlook and no significant acceleration in the pace of buybacks relative to peers, the broker believed the group lacked an immediate catalyst for a re-rating. UBS lowered its core revenue forecasts on Baidu for the 2Q24 and FY24 by 0.6% and 0.7% to RMB27.8 billion and RMB109.5 billion respectively, mainly reflecting weak advertising demand. The broker meanwhile raised its EPS forecasts for FY24 and FY25 by 4.7% and 1.6% respectively, taking into account the group's profitability. UBS trimmed Baidu's target price from US$170 to US$165 and maintained its Buy rating. AAStocks Financial News |
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