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CEO Robin Li of Baidu.com, Inc. signs the podium while presiding over the closing of trading on the Nasdaq.
CEO Robin Li of Baidu.com, Inc. signs the podium while presiding over the closing of trading on the Nasdaq.
(ROB TANNENBAUM/AP)

Chinese Internet stocks carry discount for good reason

China’s Internet stocks are red hot but investors would rather pay more for their U.S. counterparts. Shares of Chinese companies including gaming and social media giant Tencent and search engine Baidu trade at lower multiples than those of Facebook, Google and other American dot-coms when expected earnings growth is taken into account. The discount is deserved.