Ubs Securities·2026-02-28 09:40Investment Rating - The report maintains a "Buy" rating for Baidu (BIDU.US) with a target price of $180 for US shares and HKD 175 for H-shares [1] Core Insights - Baidu's fourth-quarter performance exceeded expectations, with AI-driven revenue reaching RMB 11.3 billion, a year-on-year increase of 48%, accounting for 43% of the total revenue from Baidu's core business [1] - The report anticipates strong growth in Baidu's AI business through fiscal year 2026, driven by increased adoption of AI applications, continuous product innovation, and expanded use cases [1] - Despite recent stock price volatility, the report asserts that the valuation framework remains solid, with several positive factors such as the upcoming IPO of Kunlun Chip and dividend announcements making the current stock price attractive in terms of risk-reward [1] - The report slightly raises the core non-GAAP operating profit margin due to ongoing focus on operational efficiency [1]