Baidu.com Inc. shares are down around 20 points today, after an Canaccord Adams analyst Colin Gillis, initiated his coverage of the stock, setting a $265 price target and a “Sell” rating, saying investments the Chinese search engine operator is making in 2008 are expected to increase expenses without leading to substantial near-term revenue.In the past year, the stock has moved between $92.80 and $429.19.
The analyst said he feels positive about the company’s position as a the leader in a growing market, and noted its share of the Chinese search market is over 60 percent, compared with Google Inc., which has about 24 percent.
Gillis said that the company is putting money into several new ventures in 2008, citing its new Japanese search site and an online auction business.
Gillis also initiated coverage of Google Tuesday in a note to investors, where he started the stock with a “Buy” rating and $755 price target.
The analyst added Google to his “Best Ideas” list and said the search company is a “U.S. recession-resistant investment idea” due to its international exposure and ongoing reallocation of ad budgets to measurable mediums like the Web.
