Shares of Baidu (NASDAQ:BIDU) hit an all-time high this morning after the stock temporarily poked its head above $170. 

China's leading search engine has come a long way. It was a laggard among Chinese Internet stocks earlier this year, but Baidu won back the market with a smart summertime acquisition that was followed by a blowout quarterly report in October. 

Baidu's move to acquire a leading apps marketplace provider gave it more skin in the mobile game, and that was an area where investors felt that the reborn dot-com darling was falling behind. Then we went on to find that Baidu was growing just fine when it posted third-quarter results that saw revenue climb 42% higher. Baidu's guidance at the time called for revenue growth to continue accelerating into the fourth quarter, erasing any doubts that Baidu was losing ground to Qihoo 360 (NYSE:QIHU) in search.

Qihoo 360 rolled out a rival search engine last year, and though it's growing even faster than Baidu, its stock is trading 13% below its October peak. Qihoo 360 posted encouraging financials results last week, but analysts were mixed in their reactions. Stifel downgraded the shares, but Zacks Investment Research upgraded the company behind China's leading Internet browser and online security software. Morgan Stanley boosted its price target.

It's not just Qihoo 360 that can't keep up with Baidu's new highs these days. SINA -- the company behind the Twitter-esque SINA Weibo micro-blogging platform -- is trading 16% off its all-time highs. SINA shares also peaked in October alongside Qihoo 360. 

Then again, SINA and Qihoo 360 were in favor earlier this year as Chinese Internet stock bellwethers when Baidu was being dismissed by investors. 

Bulls have stormed back into Baidu, but that also finds bears clearing out. There were just 4.6 million shares of Baidu sold short as of mid-November, well off the naysayer peak of 15.5 million shares sold short just four months earlier. It's probably not much of a stretch to point to a short squeeze that cleared out more than two-thirds of bearish wagers on Baidu as a big contributor to the stock fetching new highs this morning. 

Can Baidu keep it going? The stock is trading at nearly 26 times next year's earnings. That's not cheap, but it's a bargain relative to Baidu's growth rate. The challenge here will naturally be for Baidu to keep growing as it expands into areas outside of its search stronghold. 

Baidu's in a good place. This morning's new high isn't likely to be the last.

Longtime Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Baidu and Sina. The Motley Fool owns shares of Baidu and Sina. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.