Zacks Analyst Blog Highlights: Baidu.com, Google, Yahoo!, Xilinx and Altera

CHICAGO--(BUSINESS WIRE)--Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Baidu.com (Nasdaq: BIDU), Google (Nasdaq: GOOG), Yahoo! (Nasdaq: YHOO), Xilinx, Inc. (Nasdaq: XLNX) and Altera Corporation (Nasdaq: ALTR).

See the latest posts to the Analyst Blog:

http://www.zacks.com/blog/post_info.html?g=6

Here are highlights from Monday’s Analyst Blog:

Healthy Outlook at Baidu.com

Baidu.com’s (Nasdaq: BIDU) financial results for the first quarter again exceeded the market consensus. Being China's most popular search engine, Baidu has an advantage over rivals in China's fast-growing online advertising market.

In addition, Baidu continues to expand its product lines to attract users and boost revenue. Although fierce competition from Google (Nasdaq: GOOG) and Yahoo (Nasdaq: YHOO) prevents Baidu from building a wide economic moat, and Baidu’s Japan expansion will continue to negatively affect its financial results, we consider Baidu currently undervalued based on its growth prospects.

On April 24, Baidu announced its unaudited financial results for the first quarter ended March 31, 2008. For the first quarter 2008, its total revenues increased to RMB574.4 million (US$81.9 million), representing a 108.4% increase from the corresponding period in 2007. Operating margin in the first quarter of 2008 decreased to 27.3% from 28.5% of the corresponding period in 2007. Net income in the first quarter of 2008 increased to RMB146.6 million (US$20.9 million), representing a 71.5% increase from the corresponding period in 2007.

Valuation Attractive on Xilinx

Xilinx, Inc. (Nasdaq: XLNX) recently reported Q1:FY08 revenues of $475.7 million, in line with our estimate of $476 million. Gross margin improved to 63.4% from 62.1% in Q1 2007 and 63.3% in Q4:FY07 due to efficiencies in manufacturing and continuous yield improvements in 99-nanometer and 65-nanometer process technologies. Operating margin also improved to 24.6% from 24.3% in the previous quarter and 17.9% in the fourth quarter of fiscal 2007, as targeted by the management.

Virtex 4 and 5 generated an estimated 60% more revenues in the quarter than Altera Corporation's (Nasdaq: ALTR) competing lines. For Q1 of fiscal 2009, management expects revenues to be up 3% to down 1% sequentially. Gross margin is anticipated to come around 63% - 64%. We have adjusted our Q1 and FY2009 estimates accordingly.

Its March-quarter gross margin was the highest in the past 14 consecutive quarters. June-quarter gross margin guidance marks a 15-quarter high. Management expects gross margin to remain at comparable levels over the next few quarters. Internal reorganization should generate cost savings and operating leverage going forward.

Get the full analysis of all these stocks by going to http://at.zacks.com/?id=2649.

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