Deutsche Bank cuts everyone's rating to 2.4 dollars to sell target

In the morning of August 17, Beijing time, Deutsche Bank released its research report today, Nyse:renn the stock rating of everyone from "holding" (Hold) to "sell" (Sell) and lowered its target price from $2.89 to $2.4.

The following is a summary of the contents of the report:

-Delayed release of new games to put pressure on the foreground:

Everyone's second-quarter results were disappointing, and the outlook for third-quarter revenues falling 3% to 7% per cent was also disappointing (23% less than average Wall Street analysts), largely because of delays in the release of online games and mobile games. Meanwhile, advertising revenues have stalled because of the lack of advertising.

Given the significant slowdown in game sector growth (flat), and the fact that everyone continues to invest heavily in the glutinous rice net of the group buying department, we expect that everyone's operating losses will expand significantly in 2012 years, while the recovery time is uncertain. We downgrade everyone's stock to "sell".

-Gaming and advertising department:

Revenue growth for everyone is disappointing, mainly because of the stagnation of the online gaming and advertising sectors, where revenues were flat and revenues accounted for 77% per cent of total revenue. In particular, we believe that most of everyone's profit comes from the online gaming business, which accounts for about half of all revenue. We believe that everyone is going through a difficult transition phase, whose business is moving from an online platform to a mobile platform, while existing games on the PC side of the platform are facing obstacles to adapting to mobile trends.

-Group Buying department operating expenditure continued to grow significantly:

glutinous rice net second-quarter revenue of 6.2 million U.S. dollars, compared with the same period last year 63%, the total revenue for everyone accounted for 12%. We note that the consolidation trend in the group buying department is accelerating, with a handful of top companies gaining an oligopoly while others face a "clean" threat. We believe that the business model in this sector is still immature and lacks profitable visibility. Based on the classification and general method, we lowered the target price for everyone to $2.4 and lowered its stock rating to "sell".

We anticipate a trough in the second half of 2013 and the first half of 2014, and the visibility of the recovery now appears to be limited. Based on this, we will reduce the 2013 and 2014 fiscal year for all revenue forecasts respectively by 28% and 29%, while its 2013 fiscal year net loss (not in accordance with the United States General accounting standards) is expected to expand 30%, to 70 million U.S. dollars, 2014 fiscal year net loss

Losses (not in accordance with US general accounting standards) are expected to expand to $50 million trillion.

Upside risk: Strong user access over the next few quarters. (Tangfeng)