Baidu Posts Rare Profit Drop and 2 Other Hot Stocks to Watch
Baidu Inc. (NASDAQ:BIDU): Current price $124.96
In a surprise turns of events, the number one search engine operator in China has posted a rare drop in profits, as it moves into mobile services. On Thursday, Baidu said that profit in the most recent quarter fell by 4.5 percent to $430.8 million, but revenue jumped by 38.6 percent year-over-year to $1.2 billion. Profit took a hit from higher promotion and other costs, together with a large tax bill. Established search engines in China like Baidu, which concentrate on desktop computer-based services, are posed with new challenges as Web surfers move to smartphones and tablets. The firm said that earnings before taxes and interest increased by 8.4 percent from 2012, but net profit was lessened by a hike in the tax rate applied to one of its subsidiaries.
Bank of America Corp. (NYSE:BAC): Current price $14.73
Bank of America said Wednesday that its board has added two directors, Clayton Rose and Pierre de Weck, effective immediately. Rose is a Harvard Business School professor and a former executive at JPMorgan Chase & Co., while de Weck is a former executive at Deutsche Bank, Citicorp, and UBS. At JPMorgan, Rose was chief of global investment banking and world equities divisions. Most recently, De Weck had served as global chief of private wealth management at Deutsche Bank, up until his retirement in 2012.
Sequenom Inc. (NASDAQ:SQNM): Current price $3.31
On Wednesday, Sequenom reported disappointing second quarter results, explaining that it faces difficulties in collecting revenue for its diagnostic tests owing to changes made by Medicare and health insurers. Shares are down more than 30 percent in late-morning trading, after the company posted a quarterly loss of $31 million, or 27 cents per share. In the second quarter of 2012, it lost $29.6 million, or 26 cents per share. Revenue jumped by 91 percent to $34.9 million from $18.3 million, but analysts anticipated a loss of 21 cents per share and revenue of $46.8 million, on average, said FactSet. The company said that changes made to the billing code by the Centers for Medicare and Medicaid Services, as well as insurers, have spawned delays. The majority of state Medicaid plans have yet to implement the new codes, and in some cases, certain tests are no longer being covered. Beyond that, Sequenom indicated that it has transitioned to an in-house billing provider during the second quarter, and collections were lower than were expected.
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