Head-To-Head Analysis: Facebook (FB) vs. Renren (RENN)
Facebook (NASDAQ: FB) and Renren (NYSE:RENN) are both technology companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitabiliy, dividends, earnings and risk.
Insider and Institutional Ownership
57.0% of Facebook shares are held by institutional investors. Comparatively, 11.8% of Renren shares are held by institutional investors. 19.1% of Facebook shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Volatility & Risk
Facebook has a beta of 0.68, indicating that its share price is 32% less volatile than the S&P 500. Comparatively, Renren has a beta of 0.96, indicating that its share price is 4% less volatile than the S&P 500.
This is a summary of recent recommendations and price targets for Facebook and Renren, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Facebook currently has a consensus target price of $164.50, suggesting a potential upside of 9.96%. Given Facebook’s higher probable upside, equities research analysts clearly believe Facebook is more favorable than Renren.
Valuation & Earnings
This table compares Facebook and Renren’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|$30.29 billion||14.31||$16.36 billion||$3.26||45.89|
|Renren||$63.36 million||7.27||-$70.39 million||($2.20)||-3.06|
Facebook has higher revenue and earnings than Renren. Renren is trading at a lower price-to-earnings ratio than Facebook, indicating that it is currently the more affordable of the two stocks.
This table compares Facebook and Renren’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Facebook beats Renren on 12 of the 13 factors compared between the two stocks.
Facebook Company Profile
Facebook, Inc. is focused on building products that enable people to connect and share through mobile devices, personal computers and other surfaces. The Company’s products include Facebook, Instagram, Messenger, WhatsApp and Oculus. Facebook enables people to connect, share, discover and communicate with each other on mobile devices and personal computers. Instagram enables people to take photos or videos, customize them with filter effects, and share them with friends and followers in a photo feed or send them directly to friends. Messenger allows communicating with people and businesses alike across a range of platforms and devices. WhatsApp Messenger is a messaging application that is used by people around the world and is available on a range of mobile platforms. Its Oculus virtual reality technology and content platform offers products that allow people to enter an interactive environment to play games, consume content and connect with others.
Renren Company Profile
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.
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