Better Buy: Baidu vs. Alphabet
Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG) and Baidu (NASDAQ: BIDU) have evolved and grown into leading tech stocks in their respective countries. While Baidu drives internet search in the Chinese-language world, Alphabet's Google has become the dominant search engine overall. Though leadership in this area has benefited both companies, the question for investors is: Which one will make a more suitable stock investment?
Baidu operates in the country hardest hit so far by novel coronavirus pandemic, but it's still too early to say how the stock will be affected. The company's most recent earnings report was strong, but it only reported earnings through Dec. 31, which was before the worst effects of COVID-19 shut down parts of the Chinese economy. In its latest earnings, reported revenue of 28.9 billion yuan ($4.12 billion) surpassed expectations. The 9.19 billion yuan ($1.31 billion) in non-GAAP income attributable to Baidu also came in dramatically ahead of the 6.51 billion yuan ($930 million) for the same quarter last year.
Despite the strong showing on earnings, Baidu trades at a significant discount. Its forward P/E ratio comes in at about 16.2. That ratio actually lags the S&P 500 average P/E of around 19.4.
Source Fool.com
