Loop Capital lowered the firm’s price target on Baidu (BIDU) to $115 from $120 but keeps a Buy rating on the shares, citing valuation. The firm is reducing the company’s FY24 EPS view to $55.85 from $62.19 and its FY25 view to $55.75 from $65.56 amid a faster transition to genAI search, with Baidu having transitioned 18% of query volume to generative AI results, up from 11% in Q1, the analyst tells investors in a research note. Gen-AI services are becoming substitutes for search engines as Baidu is rapidly accelerating the behavioral shift among its users despite the revenue impact, and Google (GOOGL) is likely making a mistake by not pushing users to Gemini as quickly as they should, the firm added.
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