Will Two High Flyers Stay Aloft?

Focus:

Dan Sullivan Image Dan Sullivan Editor, The Chartist

Dan Sullivan, editor of The Chartist, highlights two of the market’s hottest stocks in recent months—Baidu.com and Crocs—which are both back near their highs after last week’s market selloff.

Baidu.com, (NASDAQ: BIDU), the “Google” of China is on the move. In just the past month, the stock soared more than 40%, and was up 72% year-to-date. (It has bounced back to near its all-time high after selling off last week—Editor.)

Established in 2000 by Robin Li and Eric Xu, Chinese nationals who studied and worked overseas before returning to China, Baidu is now the leading Chinese-language search engine. Baidu’s mission is to be the ideal Chinese search engine, offering Chinese-language web pages, news, images and multimedia files through links on its website. Baidu also offers an effective pay-for-performance online marketing platform.

Headquartered in Beijing, the company’s name was inspired by a poem written more than 800 years ago during the Song Dynasty. The word “Baidu” has a literal meaning of “hundreds of times,” which represents a persistent search for the ideal. The company focuses on what it knows best: Chinese-language search.

Applying today’s technological advances to the world’s most ancient and complex language is a heady undertaking, and the company is continually improving its products and services. The company announced its second-quarter 2007 earnings last week, and it easily topped analysts’ expectations—Editor. ) The company, which has been surpassing earnings estimates by nearly 20% for the past four quarters, expects profits to increase by nearly 70% this year. (The stock closed at $209 Monday.)

Despite being famously lambasted as a fashion disaster on Bravo’s reality series “Project Runway,” Crocs (NASDAQ: CROX) are here, probably to stay.