Baidu - call warrant spikes 114% in a week; what is going on with the shares?

Macquarie Warrants Singapore
05-11

Last week, $BIDU-SW(09888)$ shares jumped a whopping 22.3%, leading Macquarie's trending Baidu call warrant $Baidu MB eCW261005(W7QW.SI)$ (https://warrants.com.sg/tools/livematrix/W7QW) to spike 114% to SGD 0.092 over the past 8 days

  • On Friday alone, Baidu climbed 5.8% to HKD 145.20 - its highest closing price in 3 months, after Benzinga reported that Baidu's AI chip subsidiary Kunlunxin (KLX) could target a valuation exceeding 100 billion yuan for its H-share listing on the Hong Kong stock exchange

  • The day before, the China Security Regulatory Commission disclosed that KLX completed its IPO tutoring filing with the Beijing Securities Regulatory Bureau, a required step towards a potential Sci-Tech Innovation Board listing

  • While the pending listing is not a surprise as Baidu had disclosed its intention to spin off and list KLX at the start of the year, many analysts have touted its eventual IPO as a potential share price catalyst for Baidu shares

  • Meanwhile, Bloomberg Intelligence (BI) believes that Baidu's earnings outlook remains challenged due to declining search-ad revenue, increasing investment costs, and weak AI monetization, leading to a 31% downward revision in consensus earnings-per-share estimates for 2026 over the past 12 months

  • Analysts polled by Bloomberg have a 4.76 out of 5 Buy rating on Baidu shares with a 12-month target price of HKD 162.62

  • Investors who believe that Baidu shares may continue to climb higher from here can consider using trending W7QW to do so. The warrant currently trades at SGD 0.094 while Baidu shares trade at HKD 145.70

  • There is no trending put tracking Baidu shares

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