Bilibili (NASDAQ:BILI – Get Free Report) and Baidu (NASDAQ:BIDU – Get Free Report) are both communication services companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, dividends, analyst recommendations, valuation and risk.
Insider and Institutional Ownership
16.1% of Bilibili shares are held by institutional investors. 22.2% of Bilibili shares are held by insiders. Comparatively, 16.7% of Baidu shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Profitability
This table compares Bilibili and Baidu’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Bilibili | 4.88% | 11.42% | 4.29% |
| Baidu | -2.63% | 4.30% | 2.64% |
Analyst Ratings
This is a summary of current recommendations and price targets for Bilibili and Baidu, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Bilibili | 0 | 1 | 8 | 0 | 2.89 |
| Baidu | 3 | 4 | 12 | 0 | 2.47 |
Bilibili currently has a consensus target price of $29.39, indicating a potential upside of 131.77%. Baidu has a consensus target price of $144.27, indicating a potential upside of 88.83%. Given Bilibili’s stronger consensus rating and higher possible upside, analysts clearly believe Bilibili is more favorable than Baidu.
Volatility & Risk
Bilibili has a beta of 0.65, indicating that its stock price is 35% less volatile than the S&P 500. Comparatively, Baidu has a beta of 0.59, indicating that its stock price is 41% less volatile than the S&P 500.
Earnings and Valuation
This table compares Bilibili and Baidu”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Bilibili | $4.34 billion | 1.21 | $170.67 million | $0.49 | 25.88 |
| Baidu | $127.31 billion | 0.20 | $799.00 million | ($2.11) | -36.21 |
Baidu has higher revenue and earnings than Bilibili. Baidu is trading at a lower price-to-earnings ratio than Bilibili, indicating that it is currently the more affordable of the two stocks.
Summary
Bilibili beats Baidu on 11 of the 14 factors compared between the two stocks.
About Bilibili
Bilibili Inc. provides online entertainment services for the young generations in the People's Republic of China. It offers a range of digital content, including professional user generated videos, mobile games, and value-added services, such as live broadcasting, occupationally generated videos, audio drama on Maoer, and comics on Bilibili Comic. The company also provides advertising services; and IP derivatives and other services. In addition, it engages in the business and technology development activities; e-commerce business; and video, comics, and game distribution activities. Bilibili Inc. was founded in 2009 and is headquartered in Shanghai, the People's Republic of China.
About Baidu
Baidu, Inc. engages in the provision of internet search services in China. It operates through two segments: Baidu Core and iQIYI. The company offers Baidu App to access search, feed, and other services using mobile devices; Baidu Search to access its search and other services; Baidu Feed that provides users with personalized timeline based on their demographics and interests; Baidu Health that helps users to find the doctor and hospital for healthcare needs; and Haokan, a short video app. It also provides Baidu Knows, an online community where users can ask questions to other users; Baidu Wiki; Baidu Experience; Baidu Post; ERNIE Bot, conversational AI bot; Baidu Wenku; Baidu Maps, a voice-enabled mobile app that provides travel-related services; Baidu Drive; Baijiahao; and DuerOS, a smart assistant platform. In addition, it offers online marketing services, which include pay for performance, an auction-based services that allow customers to bid for priority placement of paid sponsored links and reach users who search for information related to their products or services; other marketing services that include display-based marketing services and other online marketing services based on performance criteria other than cost per click; mobile ecosystem, a portfolio of apps, including Baidu App, Haokan, and Baidu Post; various cloud services and solutions, such as platform as a service, software as a service, and infrastructure as a service; self-driving services, including maps, automated valet parking, navigation pilot, electric vehicles, and robotaxi fleets, as well as Xiaodu smart devices. Further, the company provides iQIYI, an online entertainment service, including original and licensed content; other video content and membership; and online advertising services. It has strategic partnership with Zhejiang Geely Holding Group. The company was formerly known as Baidu.com, Inc. Baidu, Inc. was incorporated in 2000 and is headquartered in Beijing, China.
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