Renren Inc. (RENN) Stock: Is This Tech Stock Worth Your Investment?

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Renren Inc. (RENN) is working its way for to the top in the market in today’s trading session. The company, one that is focused on the tech sector, is presently priced at $1.14 after tumbling -12.31% so far in today’s session. As it relates to technology companies, there are a number of factors that have the potential to lead to declines in the market. News tends to be one of the biggest reasons for the movement. Here are the recent trending headlines surrounding RENN:

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Jun-11-19 06:00PM Renren Announces Unaudited First Quarter 2019 Financial Results
07:00AM Renren Inc. to Host Earnings Call
Jun-07-19 11:39PM Renren Inc. to Report First Quarter 2019 Financial Results on June 11, 2019
May-15-19 06:00PM Renren Announces Filing of Annual Report on Form 20-F
May-14-19 04:20PM Renren Announces Unaudited Fourth Quarter and Fiscal Year 2018 Financial Results

Nonetheless, any time investors are making a decision with regard to investing, prospective investors should look at much more than news, this is especially the case in the ever changing tech industry. Here’s what’s happening in regard to Renren Inc..

What We’ve Seen From RENN

Although a move down in a single session, like the move that we’re seeing from Renren Inc. might lead to fear in some investors, a single session move alone should not be the reason for a decision to, or not to, invest in a stock. It is generally important to look at trends experienced by the stock beyond a single trading day. As it relates to RENN, below are the returns on investment that investors have experienced:

  • Past Seven Days – Throughout the past five trading sessions, RENN has produced a price change amounting to -12.98%.
  • Past Month – The monthly ROI from Renren Inc. works out to -20.83%.
  • Past Three Months – Throughout the last 3 months, the stock has produced a return that comes to -24.50%
  • Past 6 Months – In the previous six months, we’ve seen a performance that works out to -32.54% from the company.
  • This Year So Far – Since the open of this year RENN has resulted in a return on investment of -25.97%.
  • Annually – Finally, in the past year, we have seen movement amounting to 34.63% from RENN. Over this period, the stock has sold at a high price of -64.26% and a low of 35.80%.

Crucial Ratios

Digging into various key ratios associated with a company can give investors a view of just how dangerous and/or rewarding a pick might be. Here are a few of the most important ratios to look at when looking at RENN.

Short Ratio – The short ratio is a tool that’s used by traders to measure the level of short interest. The higher this short ratio, the more investors are expecting that the value of the stock is going to tumble. Across the sector, strong tech stocks can have a lower short ratio. However, we also see quite a few short squeezes in the industry. Nonetheless, as it relates to Renren Inc., it’s short ratio clocks in at 2.44.

Quick & Current Ratios – The quick and current ratios are tools that are used to get an idea of the company’s liquidity. Essentially, they measure If a company is able to pay for its debts when they come due based on current assets or quick assets. Because in tech, companies rely heavily on the continuation of support from investors as they work to bring new technologies to market, these ratios can seem bad. However, some gems in the technology space come with strong quick and current ratios. When it comes to RENN, the quick and current ratios come to 0.70 and 1.10 respectively.  

Book To Share Value – The book to share value compares the value of assets owned by the company to the share price. as it relates to Renren Inc., that ratio is 2.12.

Cash To Share Value – The cash to share value ratio compares the amount of cash the company has on hand to the value of the company’s stock. In this case, the cash to share value ratio comes to 0.11.

Smart Money Follows Big Money

An interesting fact I’ve learned so far in my brief period alive, or somewhat alive is that good investors tend to follow big money players. In general, investors that are looking to keep their investments relatively safe will pay close attention to moves made by institutional investors and insiders. So, is big money flowing as it relates to RENN? Here’s the scoop:

  • Institutional Investors – Currently, institutions hold 22.90% of the company. However, it is important to consider that the ownership held by institutions has seen a move of 0.33% over the past quarter.
  • Insiders – When it comes to insiders, insiders of the company currently hold 50.75% of the company. Insider ownership of the company has seen a change of 0.00% throughout the last quarter.

Analyst Opinions With Regard To Renren Inc.

While it’s not a smart idea to unknowingly follow the thoughts of analysts, it is a good idea to use their thoughts when validating your own thoughts when it comes to making an investment decision in the technology sector. Here are the most recent moves that we have seen from analysts when it comes to RENN.

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May-15-13 Downgrade Oppenheimer Outperform → Perform
May-31-12 Upgrade Maxim Group Sell → Hold
Feb-03-12 Downgrade Maxim Group Hold → Sell $4.50
Dec-15-11 Initiated Brean Murray Hold
Sep-23-11 Upgrade Maxim Group Sell → Hold

Financial Results And Expectations

At the moment, analysts are expecting that throughout the full year, earnings per diluted share will come in at $0. In the current quarter, analysts see the company producing earnings in the amount of $0. Over the last 5 years, RENN has generated revenue in the amount of $50.70% with earnings coming in at -36.50%. On a quarter over quarter basis, earnings have seen movement of 0 and revenue has seen movement of -21.00%.

Interested In How Many Shares Are Available?

Traders seem to have an interest in the counts of shares both available and outstanding. When it comes to Renren Inc., currently there are 79.47M and there is a float of 1.90M. These numbers mean that of the total of 79.47M shares of RENN in existence today, 1.90M are able to be traded by the public.

It’s also important to pay attention to the short percentage of the float. Think about it, if a high portion of the float is sold short, the overall opinion in the market is that the company is going to lose value. With regard to RENN, the percentage of the float that is sold short is 53.25%. Most traders believe that a concerning short percent of the float would be considered to be anything over 40%. Nonetheless, I’ve calculated that a short ratio over 26% is usually a a play that could prove to be very risky.

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