1-Star Stocks Poised to Plunge: Vringo?

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Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, Vringo (ASE: VRNG) , which buys licenses and patents, has received the dreaded one-star ranking.

With that in mind, let's take a closer look at Vringo's business and see what CAPS investors are saying about the stock right now.

Vringo facts

Headquarters (founded)

New York (2006)

Market Cap

$378.3 million

Industry

Application software

Trailing-12-Month EBITDA

($2.3 million)

Management

CEO Andrew Perlman
President/Chief Technology Officer Andrew Lang

Cash/Debt

$2.6 million / $3.2 million

Competitors

Dada Entertainment


Sources: Motley Fool CAPS and S&P Capital IQ.

On CAPS, 68% of the 22 All-Star members who have rated Vringo believe the stock will underperform the S&P 500 going forward.

Just last week, one of those Fools, TSIF, touched on Vringo's seemingly unsustainable price run:

The latest spike was due to the court [denying] Google's (NAS: GOOG) claim of "summary judgment". The claim was a standard practice and denial should have been expected. ...

The game here is purely a speculators, daytraders, pumper lovefest, with the question of who will still hold the shares when/if this crashes due to an early failure, or who gets bored when this goes into extra innings, (of which there are likely to be many).

In the meantime, this is Vringo's hail mary, and with ZERO income and no other potential for any, Vringo will continue to issue shares. ... Every goliath has a weak spot, but daydreaming or speculating your money, after a run-up is generally fatal. I'm not a lawyer, but I've watched these cases before. If Google feels threatened they will toss a bone at Vringo, heck, it might be cheaper than new suits, but even in this rare unlikelihood, it won't be the "BILLIONS" dreamers are pushing.

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The article 1-Star Stocks Poised to Plunge: Vringo? originally appeared on Fool.com.

Brian D. Pacampara has no positions in the stocks mentioned above. The Motley Fool owns shares of Google. Motley Fool newsletter services recommend Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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