7 Cheap Chinese Stocks To Invest In Now

3. Baidu (NASDAQ:BIDU)  

Number of Hedge Fund Investors: 42  

Forward P/E Ratio as of September 29: 9.32 

Baidu (NASDAQ:BIDU) is a multinational technology company that operates the largest internet search engine, often referred to as the “Google of China.” The company is in the midst of a significant transformation and is shifting its focus from an internet-centric business to an AI-centric business, with a strong emphasis on autonomous driving technology.

Baidu’s (NASDAQ:BIDU) management remains confident that AI will be a key driver of long-term revenue. The company’s AI cloud services are rapidly growing, and its development of autonomous vehicles through its Apollo project has attracted attention. According to Fortune Business Insights, the autonomous driving market is projected to experience rapid growth, with a CAGR of 32% over the next six years, reaching nearly $39 billion by 2030.  Baidu (NASDAQ:BIDU) is well-positioned to capitalize on this growing market, with its autonomous ride-hailing service, Apollo Go.

Wuhan has emerged as a key hub for Baidu’s (NASDAQ:BIDU) autonomous driving technology, with the company operating 24/7 in the city. There are currently 300 fully autonomous taxis operating in Wuhan, and the company plans to deploy 1,000 RT6 robotaxis on the streets of Wuhan by the end of 2024. The company’s RT6 is a significant improvement over previous generations, with a low unit cost of $27,500, which is half the cost of the previous generation vehicle. Additionally, a ride in a robotaxi costs half as much as traditional ride-hailing services.

Baidu (NASDAQ:BIDU) is also actively promoting its AI chatbot service, ERNIE, across its AI cloud, autonomous driving, and robotaxi businesses. This cross-promotion aims to improve user experience, boost advertiser ROI, and empower developers to build efficient applications that support millions of applications developed by a wide range of enterprise and individual developers.

The Apollo Go Robotaxi platform has the potential to pave the way for large-scale commercial autonomous ride-hailing services. With its growing presence in Wuhan and expanding fleet of RT6 robotaxis, Baidu (NASDAQ:BIDU) is well-positioned to capitalize on the growing demand for autonomous driving technology. As the company continues to advance its AI capabilities, it is likely to remain a leader in the autonomous driving space and drive long-term growth and profitability.

Baidu (NASDAQ:BIDU) is trading 9.32 times its forward-year earnings, which represents a 33.1% discount to the sector median of 13.94. Industry analysts have a consensus for the stock’s Buy rating, with a median price target of $129.67, suggesting a potential upside of almost 20.86% from current levels. As of the second quarter, 42 hedge funds owned stakes in the company valued at $1.06 billion.