Analyzing Renren (RENN) & MeetMe (MEET)
Renren (NYSE: RENN) and MeetMe (NASDAQ:MEET) are both small-cap computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, analyst recommendations, profitability, institutional ownership and risk.
Earnings & Valuation
This table compares Renren and MeetMe’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Renren||$81.49 million||6.93||-$67.85 million||($2.21)||-3.73|
|MeetMe||$97.80 million||2.74||$26.40 million||$0.24||15.54|
MeetMe has higher revenue and earnings than Renren. Renren is trading at a lower price-to-earnings ratio than MeetMe, indicating that it is currently the more affordable of the two stocks.
This table compares Renren and MeetMe’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider & Institutional Ownership
2.6% of Renren shares are owned by institutional investors. Comparatively, 56.3% of MeetMe shares are owned by institutional investors. 42.4% of Renren shares are owned by company insiders. Comparatively, 4.7% of MeetMe shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Risk and Volatility
Renren has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500. Comparatively, MeetMe has a beta of 0.8, suggesting that its share price is 20% less volatile than the S&P 500.
This is a breakdown of recent ratings and target prices for Renren and MeetMe, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
MeetMe has a consensus price target of $8.25, suggesting a potential upside of 121.18%. Given MeetMe’s higher probable upside, analysts clearly believe MeetMe is more favorable than Renren.
MeetMe beats Renren on 9 of the 12 factors compared between the two stocks.
Renren Inc. operates a real name social networking Internet platform in China. The Company enables users to connect and communicate with each other, share photos, and various features and services. The Company is developing Internet finance business to leverage its social networking services and user base in China, particularly focusing on the audience of college students and young people in China. The Company operates through two segments: Renren and Internet finance. The Company’s Renren segment focuses on online advertising and Internet value-added services (IVAS). The Company’s Internet finance segment includes Renren Fenqi, an online platform, which provides credit financing to college students in China through the form of payment by installments; its used automobile financing business, which provides credit financing to used automobile dealers, and Renren Licai, a financing and lending platform.
The Meet Group, Inc., formerly MeetMe, Inc., offers a portfolio of mobile applications. The Company operates location-based social networks for meeting new people on mobile platforms, including on iPhone, Android, iPad and other tablets, and on the Web that facilitate interactions among users, and helps users to connect and chat with each other. The Company offers online marketing capabilities, which enable marketers to display their advertisements in different formats and in different locations. The Company holds interest in Skout, Inc. (Skout), which serves as a global mobile network for meeting new people. The Company’s social networking products include Chat, Profile and Friends. Its social discovery products facilitate interactions among members. The Company’s social discovery products include Meet, Discuss and Buzz, and Interested. The Company’s products also include Social Theater.
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