1-Star Stocks Poised to Plunge: Renren?
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, Chinese social networking platform Renren (NYS: RENN) has received the dreaded one-star ranking.
With that in mind, let's take a closer look at Renren's business and see what CAPS investors are saying about the stock right now.
|Headquarters (founded)||Beijing, China (2002)|
|Market Cap||$1.5 billion|
|Industry||Internet software and services|
|Trailing-12-Month Revenue||$143.9 million|
|Management||Founder/Chairman/CEO Joseph Chen|
CFO Hui Huang
|Trailing-12-Month Operating Margin||(46.3%)|
|Cash/Debt||$922 million / $0|
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 28% of the 258 members who have rated Renren believe the stock will underperform the S&P 500 going forward.
Renren might look good, but it's an interesting case. Red thumb because anyway you slice it, [Renren] is a lose-lose: if China becomes more restrictive, less open, more communist, it can take out [Renren] in an instant. Even if China remains stable, the company's valuation is sky-high. If China magically turns into a free, open country, [Renren] will have competitors like Facebook, Twitter, etc. and lose its advantage.
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The article 1-Star Stocks Poised to Plunge: Renren? originally appeared on Fool.com.Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool owns shares of Baidu and Facebook. Motley Fool newsletter services have recommended buying shares of Baidu, SINA, Sohu, and Facebook. 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 Fool's disclosure policy always gets a perfect score.