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0416 GMT - Baidu's advertising business could be weighed by China's weak persistent macro weakness, Morningstar analyst Kai Wang says in a research note. While Baidu said its advertising business, which makes up 72% of its revenue, could see recovery in low-single-digits starting in 2Q, Morningstar sees visibility of the recovery as limited amid China's macro concerns. Baidu's ads revenue growth, which is historically at least at par with China's GDP growth, will likely underperform the benchmark in 2024, Wang says. However, a bright spot could be its cloud business revenue, which the analyst expects may rise 15% on year in 2Q and mid-teens in 2025. Morningstar lowers Baidu's fair value estimate to HK$162.00 from HK$171.00. Shares are last at HK$87.90. (sherry.qin@wsj.com)
(END) Dow Jones Newswires
July 24, 2024 00:16 ET (04:16 GMT)
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