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Technology Stocks : Renren
RENN 1.650-2.9%Jun 21 5:00 PM EST
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To: zax who wrote (164)10/15/2011 4:30:56 PM
From: Lahcim Leinad   of 310
 
StreetInsider.com keeps a running tally of which companies are buying back stock, and how much they're spending. SI is too polite to accuse companies of actually wasting shareholders' money, of course -- but I'm not. With SI's help, I've come up with two examples of popular stocks that I believe are squandering shareholder dollars on badly timed buybacks ... and one that isn't.

Renren (NYS: RENN) The first catcall this week goes out to Renren, often described as "China's Facebook." Problem is, that's not necessarily a good thing. Many a Fool has commented on the apparent overvaluation of America's Facebook. Back in June, privately held Facebook shares were trading at an implied valuation somewhere north of $70 billion. Even this nosebleed valuation looks like a bargain next to Renren, which sells for nearly 150 times projected 2012 earnings, and infinity times its current unprofitable state. Yet heedless of the obvious overvaluation, Renren recently got authorization to spend $150 million on a new stock repurchase program.

A Fool can wonder: Might not that cash be better spent fighting off well-heeled and much bigger, more established rivals like Baidu.com (NAS: BIDU) and SINA (NAS: SINA)? We'll never know. Because instead of using its (read: "your") cash to build out its business, Renren is spending a good chunk of the loot on buybacks.

See full article from DailyFinance:http://srph.it/pl7ifd

If I ever invest in this communist turd, just shoot me!
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