Compare Baidu, Inc. (BIDU) vs Netflix, Inc. (NFLX) Stock

Baidu, Inc. (BIDU) offers the better valuation at 13.8x trailing P/E (2.3x forward), making it the more compelling value choice. Analysts rate Baidu, Inc. (BIDU) a "Buy" — based on 52 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, Baidu, Inc. (BIDU) is the cheapest at 13.8x versus Netflix, Inc. at 32.7x. On forward P/E, Baidu, Inc. is actually cheaper at 2.3x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: Baidu, Inc. wins at 0.04x versus Netflix, Inc.'s 0.80x — a PEG below 1.0 traditionally signals the market is underpricing earnings growth.

Over the past 5 years, Netflix, Inc. (NFLX) delivered a total return of +53.5%, compared to -53.2% for Baidu, Inc. (BIDU). A $10,000 investment in NFLX five years ago would be worth approximately $15K today (assuming dividends reinvested). Over 10 years, the gap is even starker: NFLX returned +772.4% versus BIDU's -23.7%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), Netflix, Inc. (NFLX) is the lower-risk stock at 0.78β versus Baidu, Inc.'s 0.88β — meaning BIDU is approximately 13% more volatile than NFLX relative to the S&P 500. On balance sheet safety, Baidu, Inc. (BIDU) carries a lower debt/equity ratio of 28% versus 54% for Netflix, Inc. — giving it more financial flexibility in a downturn.

Netflix, Inc. (NFLX) is the more profitable company, earning 24.3% net margin versus 17.8% for Baidu, Inc. — meaning it keeps 24.3% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: NFLX leads at 29.5% versus 16.0% for BIDU. At the gross margin level — before operating expenses — BIDU leads at 50.3%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential. By this metric, Baidu, Inc. (BIDU) is the more undervalued stock at a PEG of 0.04x versus Netflix, Inc.'s 0.80x. A PEG below 1.0 is traditionally considered the threshold for growth-adjusted undervaluation. On forward earnings alone, Baidu, Inc. (BIDU) trades at 2.3x forward P/E versus 26.4x for Netflix, Inc. — 24.1x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for NFLX: 41.8% to $117.25.

None of the stocks in this comparison currently pay a material dividend. All are effectively zero-yield and should be held for capital appreciation rather than income.

For long-horizon retirement investors, Netflix, Inc. (NFLX) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.78), +772.4% 10Y return). Both have compounded well over 10 years (NFLX: +772.4%, BIDU: -23.7%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Communication Services sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. In terms of investment character: BIDU is a mid-cap deep-value stock; NFLX is a large-cap quality compounder stock. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.