Shares of Baidu (NASDAQ:BIDU) slumped more than 11% on Tuesday a day after the Beijing-based search engine revealed its slowest profit growth since 2009 amid growing competition and China’s weakening economy.
In the wake of the earnings report, the Google-rivaling (NASDAQ:GOOG) company in Asia was slapped with a handful of downgrades and negative notes from analysts.
Raymond James (NYSE:RJF) cut Baidu to “market perform” from “outperform,” while Barclays (NYSE:BCS) axed its price target on the search engine to $108 from $113 previously on an “equal weight” rating.
Stifel Nicolaus cut Baidu to “hold” from “buy” and Brean Capital lowered its target price on Baidu to $120 from $125 but maintained its “buy” rating.
Baidu on Monday evening posted a 36% increase in quarterly profit, the softest improvement in four years.
Its revenue climbed nearly 42% to $1.02 billion and topped Wall Street expectations, however analysts are warning that sales could be pressured going forward as Chinese users change their habits and competition continues to intensify.