3 New Growth Engines for Baidu

Baidu (NASDAQ: BIDU ), the Internet technology and software company best known as the “Chinese Google” because of its search engine, has been doing what cheeky investors might call the Apple (NASDAQ: AAPL ) dance since the beginning of 2011. The stock has risen about 30% in 2011 alone — a spur fueled by international interest in the company as well as monumentally impressive fourth-quarter earnings. Baidu’s stock rise is hot , which may lead investors to wondering if a ceiling is approaching. However, Baidu isn’t done growing. Here are three new expansions by the company to consider when weighing Baidu’s  stock prospects for the rest of 2011. Anjuke.com Baidu invested $50 million in this real estate listing website at the beginning of March, more than tripling that company’s funding. Baidu clearly sees an opportunity in reinvesting its cash flow in a sector that its Western rival Google (NASDAQ: GOOG ) just abandoned. Provided Anjuke lives up to Baidu’s expectations, both an outright purchase of the company or an acquisition of the website by a third party will yield great results for Baidu.   Qiyi If Baidu is the Chinese Google, Youku (NYSE: YOKU ) is the Chinese YouTube. And shares in the online video host have performed almost as well as Baidu in 2011, growing by almost 40% between February and April. With a one-third share of the web video market in China, it’s the company to beat. Of course, that share has declined from 41% over the past year, which means that Youku is vulnerable. The Qiyi joint venture, a Youku competitor owned by Baidu, may just be the service to beat it. Qiyi released a new web browser-free video service that stands a good chance to further erode Youku’s market share and open up yet another revenue stream for Baidu. Baidu Ting One strike against Baidu is how its search services have enabled media piracy, particularly music. Looking to staunch the flow of criticism, Baidu is getting into the music business with Baidu Ting. Baidu representative Kaiser Kuo told Reuters on Thursday that the service will let users stream audio as well as download and store MP3s on the company’s servers. There will also be a social networking component for the service, which will launch in May. While piracy will undoubtedly continue to be an issue for Baidu (as it will for any search company), Baidu Ting will introduce a steady stream of revenue from advertising coming from potential new partnerships with music interests like Sony (NYSE: SNE ) and Time Warner (NYSE: TWX ).   As of this writing, Anthony John Agnello did not own a position in any of the stocks named here. Follow him on Twitter at  @ajohnagnello  and  become a fan of  InvestorPlace on Facebook.
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