First Person: I Lost My Shirt in China, but How I Kept My Pants

After several weeks of watching the rollercoaster in China, it’s official, Renren, Inc. is consider by some analyst including Alex Planes from Motley Fool,, as the worst IPO of 2011. Renren has dropped from the high of $24 to last reported $3.56. I invested in Renren at $11. It was considered The Facebook of China, but as an investor I have not seen “Facebook Money”.

As of March 1, 2012, Renren limped up to $5.48. It has been a rocky ride for Renren’s investors who have decided to exit the company for safer waters. I lost my shirt and tie when I invested in Renren.

However, I kept my pants when I invested in Baidu (BIDU). I was convinced as most investors that Renren would be another great run like Baidu. Baidu has been up. Baidu called “The Google” of China has gone in my portfolio from $82.25 to last report $138. Baidu unlike Renren has outperformed each quarter.

Renren according to several reports will not rebound to the high levels of its IPO offering and is facing lower quarterly numbers. Several blogs have indicated even though Renren might have cash filled pockets they are not returning the equity to their investors. While the same reports pick Baidu as continuing to return great numbers and outperform the market this year.

Renren (RENN) shares quarter results on March 8th. The analyst expects the company to earn $0.02 per share on $32 million in revenue. As Renren strengthens its leadership in China, Renren’s group-buy unit, Nuomi, the company’s profitability, could be hammered as it invests heavily in sales and marketing to maintain its competitive edge in China’s group-buy industry.

As an independent investor, I stake my claim on holding on to Renren and hope that someday I have enough equity in Renren’s stock to buy a new shirt.

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