Deutsche Bank maintains a sales rating for everyone's stock

Deutsche Bank today released a study to maintain a "sell" rating for Nyse:renn shares and a 2.46 dollar target share price.

The following is the full report:

Short-term focus on investment efficiency

After a few years of inefficient investment in gaming and group buying, the company's management says it is now more conservative in its investment budget and only invests in areas that bring real returns. With respect to the core gaming business, everyone cuts spending by reorganizing the team and the product line. The company will focus on high-quality games that may not be market leaders but will bring profits. The company does not plan to directly challenge rivals such as Tencent, but is committed to consolidating the market share of college students.

Mobile game Strategy

In the fourth quarter of 2013, Renren officially launched the first pure smartphone game, "everyone show Dance". So far, the game's operating performance is in line with the company's expectations and is the first outcome of the company's cautious investment strategy. Management of the Company believes that such a cost-effective game will be the company's future game business development strategy, and the 2014 fiscal year, the company plans to launch a quarterly 1 to 2 independent research and development of the game. At the same time, Renren is also considering purchasing a license for high-quality Third-party games.

Other key information

Renren began selling mobile ad spots in the fourth quarter of 2013. Given that China Mobile's advertising market is still at an early stage of development, the company's management is confident about the growth prospects of the mobile advertising business. 56.com is another example of a conservative investment strategy for everyone. The 56.com platform currently provides only user-produced content (UGC), while user traffic is rapidly increasing.

Financial performance Expectations

We expect that Renren will have a net revenue of USD 30 million in the fourth quarter of 2013 and $174 million a year in 2013. In the fourth quarter of 2013, the non-US GAAP net loss was USD 51 million, and 75 million USD in 2013.