Shares of Baidu (Nasdaq: BIDU) hit an all-time high today, fueled by yet another analyst upgrade.

HSBC is boosting its rating on China's leading search engine -- from "neutral" to "overweight" -- raising its price target from $116 to $158.

Macquarie Research, ThinkEquity, and Pacific Crest have all recently jacked up their price targets. They're the lucky ones. They got their clients in before the dot-com darling's blowout quarter last week.

Is HSBC too late? Is it arriving to the party after somebody's already called the cops?

It was easy to buy into Baidu's growth thesis in 2010. Google's (Nasdaq: GOOG) decision to effectively bow out of China on principle opened the door for Baidu to pad its already impressive market share. Baidu also completed a shift to a more Google-esque Phoenix Nest model, enhancing monetization along the way.

The comparisons will get tougher from here.

Analysts see earnings climbing by 61% to $2.46 a share this year on a 60% top-line surge. This would be an enviable performance for any company, but it's off when pitted against Baidu's historical performance. Wall Street sees the deceleration continuing into 2012, with revenue and net income targeted to grow by 44%.

Based on last night's close, Baidu shares are trading at 49 times this year's projected profitability and a more reasonable 34 times next year's target. That's not cheap, but it's not necessarily outlandish, given that it's still growing its bottom line at a greater pace than the forward P/E ratios.

Baidu remains China's best bet in paid search. There are cheaper plays to be had in display advertising, where SINA (Nasdaq: SINA), Allyes.com parent Focus Media (Nasdaq: FMCN), and Sohu.com (Nasdaq: SOHU) carve cozy livings. I like all three companies, but none of them will ever be China's Google. Baidu wears that crown, and no one is even close in challenging its leadership.

The only concern here is that the recent bullish wave of analysts is unsettling to my inner contrarian. Baidu has made mincemeat out of Wall Street's profit targets in the past.

Quarter EPS Estimate EPS Actual
Q1 2010 $0.15 $0.20
Q2 2010 $0.31 $0.35
Q3 2010 $0.42 $0.45
Q4 2010 $0.45 $0.50

Source: Yahoo! Finance.

Now that so many analysts are on board with bullish calls, will they begin to catch up to Baidu's real earnings power?

Investors are unlikely to be smarting if Baidu earns the $3.55 a share that analysts see out of Baidu next year, but the past couple of years of market-thumping results -- and market-walloping capital appreciation -- have come as the welcome byproduct of skeptical analysts who perpetually underestimated the Chinese darling's potential.

A little cynicism is good in any bullish thesis. Welcome to the winning side of the argument, HSBC. Let's hope there are still more skeptics out there to win over to keep the Baidu bus rolling. 

Do you think Baidu is overvalued or undervalued right now? Share your thoughts in the comments box below.

Google is a Motley Fool Inside Value recommendation. Baidu, Google, and Sohu.com are Motley Fool Rule Breakers selections. SINA is a Motley Fool Stock Advisor pick. The Fool owns shares of Google. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Longtime Fool contributor Rick Munarriz has been a fan of China's growth stocks for several years now, even though he owns no shares in any of the companies in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.