Baidu.com slide may not be over

NEW YORK – If Baidu.com Inc. were a band, it would be ‘Nsync. If it were a fashion item, it would be leg warmers. If it were home decor, it would be avocado green shag carpeting. Baidu, the much hyped “Chinese Google,” skyrocketed 354 percent on Aug. 5, 2005, the day it went public. Now it stands as one of the embarrassing investments of the last year.

Baidu’s American Depositary Receipts, which climbed as high as $153.98, now trade below $58 a share. What could be even more cringe-worthy for Baidu investors is the future: After months of decline, analysts say Baidu is still overpriced.

Baidu’s history, so far, is one of hope colliding with reality. The Beijing-based company went public at $27 a share, then climbed to $122.54 its first day of trading. On Friday, the shares closed at $57.40, up 13 cents.

Citigroup has a “Sell” rating on Baidu.

Anthony Noto of Goldman, Sachs & Co. said he couldn’t justify the company’s valuation. The company’s estimated price-to-earnings ratio for 2006 is 84.7 percent.

Noto attributes Baidu’s valuation “to exuberance over the opportunity in China as the economy booms” and excitement over Internet search companies based on Google’s strong performance.