In the following video, Fool analysts Jeremy Phillips and Austin Smith discuss Internet search provider Baidu , often referred to as China's Google .
Baidu has underperformed the market by about 30% over the past year, Jeremy says. That's significant for a company that is so well positioned it essentially operates as a monopoly.
Scares over fraudulent Chinese companies have dragged down Baidu's price. Worries over a slowing Chinese economy also have delivered a blow, Jeremy says. But he sees this as a buying opportunity for the stock.
Because it operates in China, Baidu is one of the few Google-proof Internet companies in the world, Jeremy says. Baidu has been able to not only outpace Google's growth, but it has nearly doubled it, averaging about 70% growth, Austin notes. And that's in a nation where only about half of the people have Internet access.
With that growth, and a price that has Baidu trading at the same multiple as Google, the two analysts see the stock as a buy.
Baidu has been a longtime pick of Motley Fool superinvestor David Garder, and it has soared 1,092% since he recommended it in October 2006. David specializes in identifying game-changing companies like this long before others are keen to their disruptive potential, and in helping like-minded investors profit while Wall Street catches up. Learn more about how he picks his winners with a free, personal tour of his flagship service, Supernova. Inside you'll discover the science behind his market-trouncing returns. Just click here now for instant access.
The article Why I Loaded Up on Baidu originally appeared on Fool.com.
Austin Smith, Jeremy Phillips, and The Motley Fool own shares of Google and Baidu. The Motley Fool also recommends Baidu and 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. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.