0859 GMT - Baidu's continued advertising weakness overshadows its strength in the AI cloud segment, according to Morningstar senior equity analyst Kai Wang in a research note. The company's overall revenue in 1Q was better than Morningstar's flat growth estimate, but online marketing revenue was weaker than expected and offset strength in the cloud business, Wang says. "We believe that ad performance will still dictate how investors view the stock near term, despite continued robust growth" and rising market share in AI cloud, Wang notes. Morningstar lowers its fair value estimate to HK$143.00 from HK$154.00, but notes that it remains undervalued as it isn't fully reflecting a recovery in the ad business. Shares closed at HK$83.10. (tracy.qu@wsj.com)
(END) Dow Jones Newswires
May 23, 2025 04:59 ET (08:59 GMT)
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