Dallas, Texas 10/15/2013 (Financialstrend) – Chinese internet stocks have been on the move lately. The stock of the Chinese social networking site Renren Inc (NYSE:RENN) has benefitted significantly from this rally. In the past 30 days the stock has gained close to 3.6%. Analysts believe that positive response elicited by the announcement of “Twitter IPO” is the engine which is propelling the stock of other internet and social media players. Jay Jacobs, research analyst of Global X funds has opined that “Twitter’s IPO is a vote of confidence for the social-media industry.” On the back of this investor interest stock of Beijing based Renren went up 16% over a two day trading period.
Readers should also note that analysts are predicting that investors who are pulling out their investments from Chinese airlines will park their funds in the social media and internet companies like Baidu and Renren. Other internet players who gained in this rally were Elong Inc which increased by 20 percent. Analysts in the know are predicting that Baidu is likely to extend its investment in Renren. Baidu had acquired an initial stake in Renren during August this year.
The stock has struggled to retain the valuations it gained over the past two weeks. During trading last week the stock was down 7.43%. When trading resumed for the week on October 14, the shares of the stock was down 1.07% compared to its previous day close. In spite of the dip in valuation the market cap of this social networking company is hovering around the $1.4 billion. It has managed to post sales of $195 million with a $48 million net loss over the past 12 months trailing period. It has employed close to 4602 people and has recorded gross margins of 63% over the past 12 months. It is expected to announce its 3Q results on November.