So what: NQ Mobile sent skittish investors running for the hills yesterday after delaying its annual report for the second time amid allegations of fraud from noted short-seller Muddy Waters. Previously, NQ insisted the investigation being performed by its independent auditor had uncovered no evidence of such fraud, but still filed for the original 15-day extension from the SEC's April 30 deadline as it awaited the results.
Now what: I'll admit I'm a perennial optimist, and I understand the stock appears to be ridiculously inexpensive trading around five times next year's expected earnings. However, I've repeatedly voiced concerns that Muddy Waters' red flags hold a bit too much merit to be completely taken with a grain of salt. As a result, however "cheap" NQ Mobile shares might appear, the stock remains a risky bet I'm not willing to take.
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