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 (NYSE: 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.

Renren facts

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
Competitors Baidu
SINA
Sohu.com

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.

Just yesterday, one of those bears, EvanBuck, succinctly summed up the bear case for our community:

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.

If you want market-topping returns, you need to protect your portfolio from any undue risk. Luckily, we've found another growth play we are incredibly excited about -- excited enough to dub it "The Only Stock You Need to Profit from the NEW Technology Revolution." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.

Want to see how well (or not so well) the stocks in this series are performing? Follow the TrackPoisedTo CAPS account.

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.


Read/Post Comments (2) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On August 10, 2012, at 10:43 AM, orentas wrote:

    what an idiot u are!

  • Report this Comment On August 10, 2012, at 4:24 PM, Hosana33 wrote:

    Are you short the stocks you say are about to plunge

    or do you get paid by the people that are shorting?

    You love to use the same headline on your articles i see,so be a man and go full disclosure!

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1980459, ~/Articles/ArticleHandler.aspx, 11/24/2014 8:07:24 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement