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Renren Inc. Message Board

  • mmmparsley mmmparsley Jun 7, 2011 3:56 AM Flag

    Way too many alarm bells here...

    > Accounting Issues with former CFO being accused and guilty of fraud with LongTop

    > Very little market share growth over the last year according to alexa statistics

    > Valuation of 2.5x higher Price/Sales compared to well-estabalished HOT IPO LinkedIN

    > Based in China and subject to political unpredictability.

    > No profitability.

    > Plenty of well-funded competitors.

    So although RenRen may end up being successful, why would you bet on a child to make his way through a field littered with land mines.

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    • tingmur Jun 7, 2011 8:43 AM Flag

      you funny renn the sell you mine for $1000/share...bwa..ha.hha.a..a

    • Are you just waking up from a slumber party and trying to bring to notice what has been pointed out 100s of time?????

    • The better question is Why would you short a company that has dropped from 24$ to 12$ and has such great potential. I tell u what you put your credentials on your next post. Here are the credentials of the CEO's.

      Mr. Chen holds a bachelor's degree in physics from the University of Delaware, a master's degree in engineering from the Massachusetts Institute of Technology, and a M.B.A. degree from Stanford University.

      good luck with betting against Renn's management

    • Remember the hype around E-Future (EFUT) 5 years ago?
      It reached $48.00 per share to a market cap of about 144mm and a price to sales ratio of just under 30 vs. RENN's of Over 50.

      Efuture has since grown revenues at 35% average clip since the IPO - which is pretty good - all things considered. Meanwhile the share value has lost over 90% since the peak and is trading now for $4.33.

      Now Efuture trades at a Price/Sales ratio of 0.67 vs. RenRen's current price/sales ratio of 63.19 - about 100x more richly valued. While Efutures contract backlog grew at 100%, which purports to higher growth in 2011... Renn's growth is slowing down over the last few months.

      How could one justify RENN's value at 100x steeper valuation vs. Efuture when they are both growing at comparable rates?

      Moreover, Efuture has gone way over the top to be fiscally transparent, doing considerably more than their much larger US-Traded Chinese counterparts in providing very detailed financial reporting. Renn's CFO stepped down due to fraud allegations that ended up being right on... while lying about their user-growth just shortly before the IPO, inflating the growth by 10% vs. reality.

      Just some thoughts... thinking of potentially building a short position here.

1.83-0.01(-0.54%)Jun 29 4:02 PMEDT