Rhys Adams @adams302: "Hello Ladies and Gentleman, Last week..."

Australia

Hello Ladies and Gentleman, Last week I posted about our portfolios most recent acquisition, $BIDU (Baidu, Inc.-ADR). The post explained the logic behind the purchase, but to cut it down, I skipped over the numbers. This is a quick financial summary of why I decided to make the purchase and to help you all understand what I look for when purchasing a company. 𝙏𝙝𝙚 𝙞𝙣𝙘𝙤𝙢𝙚 𝙨𝙩𝙖𝙩𝙚𝙢𝙚𝙣𝙩. First of all, Baidu's net profit for the first half of 2025 is approximately 2 Billion USD, giving the company a P/E ratio of roughly 10 (Meaning for every dollar of profit the company makes, it sell for $10). This by itself is nice and low, but It is even better when you consider the net profit growth rate over the past year has been 40% with 18% the year prior. The profit is growing fast and the company is still trading at cheap prices. Prior to the last two years, Baidu has had some ups and downs with their income, with decreasing revenue from their primary source of web advertising. However with their recent push into AI, they have been offsetting this decline by a steep rise in the AI sector revenues. 𝙏𝙝𝙚 𝙗𝙖𝙡𝙖𝙣𝙘𝙚 𝙨𝙝𝙚𝙚𝙩 $BIDU debt-to-equity ratio is approximately 0.32, showing a conservative financial leverage. This ratio means that for every dollar of equity, the company has about 0.32 cents in debt. For a technology company, this is very low. They have $41.58 Billion USD in net assets, with a market cap of $41.44 Billion USD. This is always a nice indicator, that its share price is back up by asset value, not just income. The company also has a very healthy cash or cash equivalent position of $21 Billion USD. I love to see this, it shows safety as well as a great position to capitalise on future opportunities. Cash is often king. We all know the future is uncertain, global politics, trades, AI, who knows what will happen. So I love it when I see companies have plenty of cash behind them, putting them in a great position to deal with any situations which may arise. I have tried to keep this as short and simple as possible. When purchasing as stock I will dive into their financials over the past 10 years, however I have left most of the historical numbers out of the post, otherwise it would be at least twice as long. if any of you have any questions, please feel free to ask. Have a great day! Kind regards Rhys Adams

BIDU

Baidu, Inc.-ADR

145.71

6.97 (5.02%)

1 Mentioned

BIDU

Baidu, Inc.-ADR

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