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Two of Baidu.com’s underwriters, Goldman Sachs and Piper Jaffray, have rated the stock as “underperform” today. Goldman even said that the company is worth just $27, which is the same as its IPO price. Yesterday, shares of Baidu closed at $113, and it’s been as high as $153. On its first day of trading, the stock jumped 345%.

Anthony Noto, the Goldman analyst, said that at the most extreme, Baidu could be worth $45 a share.

Noto's forecasting growth rates of 35% for revenue and 40% for earnings per share between 2006 and 2009. In 2006 alone, the Goldman Sachs analyst estimates Baidu.com will see earnings-per-share growth of 106% on a 71% jump in revenue.

Noto bases his forecast on the company's solid results to date and on an exploding Chinese market.

"By 2008, the number of Internet users in China should reach 252 million, surpassing that of the U.S. despite only representing 19% of the expected population at that time vs. 71% for the U.S," said Noto. "These strong secular growth trends provide a positive backdrop for Baidu."

Baidu’s stock is currently down about 24% in pre-market trading.

Posted by edelfenbein at September 14, 2005 9:13 AM