Baidu Inc. ADS (BIDU)

FairStock Score: 54/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

Baidu is a Chinese internet and AI group, with search/content, AI cloud, intelligent driving, and iQIYI. The business quality is mixed: the latest provided quarter, fiscal Q2 2026, had revenue of $31.3B and net income of $2.3B, a 7.4% margin, so it can still earn money. But the trailing picture is weak. Over the trailing period reflected in the supplied growth figures, revenue growth is -1.16% and profit growth is -55.36%; the supplied trailing EPS is -$2.34, which makes the FairStock P/E -33.27 at the 2026-10-26 close. Free cash flow is the biggest red flag: -$14.1B trailing twelve months and a -33.6% FCF yield. That is not the sort of cash economics Graham would pay much for. The balance sheet is not stretched, with D/E 0.38, but Altman Z-Score 1.06 is weak, ROE is -1.39%, and ROCE is only 1.20%. The competitive position may have optionality in AI cloud and intelligent driving, but the current numbers do not show durable earning power. Valuation is the counterweight: P/B is 0.65 at the close, market cap $41.8B, beta 0.57, and FairStock Score 54/100. A low asset multiple can be a starting point, but only if cash flow and returns recover; otherwise it is a value trap. I would need evidence of positive free cash flow and stabilizing revenue before calling this a compelling Buffett-style bargain.

In plain English: Baidu runs search and content, online video through iQIYI, AI cloud and smart-driving businesses in China. The business looks weak right now: revenue slipped, profit fell sharply, and cash generation is negative. The stock looks cheap relative to the value of its assets on the books, but weak cash generation makes it hard to call it a bargain.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-26 close · note generated 2026-10-28 · model deepseek-flash

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer