Youku Tudou Inc (ADR) (YOKU) Is No SINA Corp (SINA) or Baidu.com, Inc. (ADR) (BIDU)

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Youku Tudou’s margins will improve in time, but this will never be one of China’s most profitable companies in terms of margins. Bandwidth costs may fall and marketers may be willing to spend more to reach viewers, but investors need to be realistic.

Youku Tudou is the star player of a growing online niche, but there’s more to worry about than just this sharp sequential slip.

The article Youku Tudou Is No SINA or Baidu originally appeared on Fool.com and is written by Rick Aristotle Munarriz.

Longtime Fool contributor Rick Aristotle Munarriz has no position in any stocks mentioned. The Motley Fool recommends Baidu, NetEase.com, and SINA. The Motley Fool owns shares of Baidu.

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