The brief public life of Baidu.com
Wednesday night was no exception. The stock traded 13% lower after what would have been healthy results if not for the market's lofty expectations. Revenues surged 174% higher. Momentum is certainly in place, as the company expects revenue growth to accelerate after soaring 215% to 227% higher in the current quarter.
Baidu accomplished this growth with a 148% spike in advertisers. That means the average sponsor is spending more these days on China's largest website.
The company is profitable, though 10% in net margins pales in comparison with the loftier production of other Chinese stocks, like Rule Breakers recommendations NetEase.com
However, Baidu's presence as China's leading search engine -- with Google
Yes, it's kind of surprising to see such amazing trading volatility in a company that will take years to vindicate either the longs or the shorts. I bought into the company earlier this month knowing that this was supposed to be a long-term position. I will consume every quarterly report, yet I know that this is the kind of company that will find its success measured in years. Not quarters. Not months. Not the occasional wild trading day.
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Longtime Fool contributor Rick Munarriz is a huge fan of the online search engine space, and he does own shares of Baidu.com. The Fool has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.