Baidu Inc ADR  BIDU

Summary (from latest annual report – 2014)

• Total equity  : 8.47 billion USD
• Market Cap is 66.9 billion USD ( last price of the stock is 193,68 USD)
• Baidu, Inc. (Baidu) is a Chinese-language Internet search provider. Baidu serves three types of online participants, which include users, customers and Baidu union members
• Equity of total company increased from 6.01 billion in 2013 to 8.47 billion in 2015
• Company has 2.23 billion USD in cash on account (at the end of 2014 year)
• Total equity – cash on account = 6.24 billion usd
• Goodwill of Baidu is 2.8 billion USD
• In 2014 company had 3.78 billion usd long-term debt and 364.08 million usd short-term debt which is a big amount (In 2013 company had 2.77 billion usd long-term debt and 55 million usd short-term debt)
• Baidu’s balance sheet has become stronger in 2014 (In latest annual report - total equity increased to 8.47 billion USD from 6.01 billion in 2013, but total debt also increased in 2014 to 4.14 billion usd from 2.82 billion usd in 2013)
• Company's sales increased in 2014 to 7.9 billion usd from 5.14 billion in 2013 – very good numbers
• Net income increased in 2014 to 2.12 billion usd from 1.69 billion in 2013
• Cash flow from operations was 2.89 billion usd in 2014
• In 2014 company paid 54.45 million usd dividend to its shareholders

Standalone Subsidaries :

• Qunar Cayman Islands Limited - In 2012 Qunar was acquired by baidu for 300 million, but current equity is 38 million.  * might be a writedown of at least 200 million if the qunar brand does implode!
• Qiyi.com, Inc -22% market share , 2nd largest video youtube like site in china, Acquired controlling stake in 2012 ,Equity around 1.5 to 2 Billion.  Competing site (YOKU , market cap : $5billion , 33% market share)  Also acquired PPS Stream for $300-400 million dollars.  Merger of Qiyi and PPS, Total Equity around 1.8 to 2.4 billion USD,.
• 91 Wireless Websoft Limited -  91wireless, was acquired for 1.9 billion for 51% stake.  which means total equity estimated around 4 billion and change.  reasoning for 4billion valuation and purchase? 91wireless is chinas android dominant app market, similar to amazon appstore or google play appstore in the states.

TOTAL Equity for (91+Qunar+Qiyi) Subsidaries = Estimated 6.75 billion USD

Opinion about the company

Fundamentally it is a good company and in the future we can expect its growth (the only concern is amount of total debt  (4.14 billion usd), ROE is around 23%).