By IB Times Staff Reporter: Subscribe to IB's RSS feed
December 23, 2010 11:03 AM EST
As the year 2010 drawing to a close, let's take a look at some internet stocks that could give better returns to the investors in 2011.
ThinkEquity has listed out its leading internet stock picks for 2011 that includes Google (GOOG), Baidu (BIDU) and Priceline (PCLN). Following are those stocks.
Google (GOOG): The brokerage expect outperformance for Google, given continued strength in the paid search market driven by a modestly improving economy and online share gains and traction with non-search businesses, primarily display and mobile.
The brokerage expects growth of 18 percent in revenue and 19 percent in earnings per share (EPS) in 2011.
The brokerage believes Google's current valuation at 17x 2011 proforma EPS or 15 times excluding cash, is discounting much lower growth rates.
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"We believe continued solid search growth, traction in non-search businesses, and the introduction of 2012 estimates could serve as catalysts for shares," ThinkEquity analysts wrote in a note to clients.
ThinkEquity has a 'buy' rating and a price target of $760 on Google stock.
GSI Commerce (GSIC): The brokerage expects continued solid top line results for GSIC driven by eCommerce segment and expects GSIC to continue to outperform the broader eCommerce sector. Further, continued strength in the higher margin marketing services business and traction with the RueLaLa private sales business would also benefit the company.
"Further, we believe recent investor concerns over's GSIC's competitive position are overblown and the separating of its tech platform should expand GSIC's addressable market," analysts wrote in a note to clients.
The brokerage has a 'buy' rating and $31 price target on GSIC stock.
Baidu (BIDU): ThinkEquity expects another strong year of growth for Baidu in 2011 driven by continued consumer Internet adoption as it expects China to add another 70 million Internet users in 2011 up from about 450 million at the end of 2010.
Baidu is also expected to benefit from continued merchant adoption coupled with strong growth in emerging categories including eCommerce.
"We believe these factors should lead to 60 percent plus growth in 2011 and we expect continued strong incremental margins which we expect to lead to 70 percent plus EPS growth," analysts said.
The brokerage has a 'buy' rating and $130 price target on Baidu stock.
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