UPDATE: Deutsche Bank Cuts PT to $2.89 on Renren; Margin Pressure From Investment Ramp-Up, Competition
Deutsche Bank maintained Renren (NYSE: RENN) with a Hold rating and lowered the price target from $3.24 to $2.89.
Deutsche Bank noted, "Although solid revenue growth from gaming and narrowing operating loss from Nuomi point to Renren's investment over the past four to six quarters generating visible financial returns, we believe Renren's growth trajectory over the next two years is unclear. Despite Renren's first-mover advantage in the cross-platform mobile gaming market, competition from content and user acquisition perspective is likely to intensify in 2013. Financial returns from introducing mobile games on the Android platform are yet to be proven. Management is also likely to increase spending on Nuomi to gain more market share or geographical exposure in 2H13."
Renren closed at $3.03 on Monday.
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