Financial Survey: StoneCo (NASDAQ:STNE) & Renren (NASDAQ:RENN)

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StoneCo (NASDAQ:STNE) and Renren (NYSE:RENN) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, risk, earnings, institutional ownership, profitability, analyst recommendations and dividends.

Analyst Recommendations

This is a summary of recent recommendations and price targets for StoneCo and Renren, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
StoneCo 1 3 3 0 2.29
Renren 0 0 0 0 N/A

StoneCo presently has a consensus price target of $33.00, indicating a potential upside of 13.25%. Given StoneCo’s higher possible upside, research analysts clearly believe StoneCo is more favorable than Renren.

Institutional and Insider Ownership

37.2% of StoneCo shares are owned by institutional investors. Comparatively, 1.5% of Renren shares are owned by institutional investors. 42.4% of Renren shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares StoneCo and Renren’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
StoneCo $414.74 million 19.47 $91.43 million $0.33 88.30
Renren $498.20 million 0.14 $72.54 million $1.29 0.78

StoneCo has higher earnings, but lower revenue than Renren. Renren is trading at a lower price-to-earnings ratio than StoneCo, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares StoneCo and Renren’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
StoneCo N/A N/A N/A
Renren 17.78% -27.86% -12.56%

Summary

StoneCo beats Renren on 8 of the 12 factors compared between the two stocks.

About StoneCo

StoneCo Ltd. engages in the provision of financial technology solutions. It caters to merchants and partners that conduct electronic commerce across in-store, online, and mobile channels. It offers cloud-based technology platform, electronic payments, and automation of business processes at the point-of-sale. The company was founded on March 11, 2014 and is headquartered in São Paulo, Brazil.

About Renren

Renren Inc. operates a social networking Internet platform in the People's Republic of China. It operates through two segments, Renren and Auto Group. The company operates Renren.com and Renren Mobile App that enable users to communicate and stay connected with friends, classmates, family members, and co-workers; and woxiu.com, a PC-based social video platform for users to stream their performances live to viewers. The company also sells used automobiles and related products; arranges financing options for customers through its financial services partners; provides credit financing for used automobile dealerships; and sells new cars, as well as provides value-added services, such as warranties, insurance, and after-sale products and services. It offers vehicles at its in-store showrooms; and through Kaixin Auto app, as well as through other online vertical channels, such as Autohome and 58.com. In addition, the company develops Chime, a software as a solution platform that offers lead generation and customer relationship management solutions for real estate professionals; and provides customizable lead capture landing pages that offer multiple home value estimates in the United States. Further, it provides online and mobile services for the trucking industry in the United States. The company was formerly known as Oak Pacific Interactive and changed its name to Renren Inc. in December 2010. Renren Inc. was founded in 2002 and is headquartered in Beijing, the People's Republic of China.

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