This Chinese Penny Stock Could Have 600% Upside

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Everyone knows the risks of investing in penny stocks, but there’s no denying they can also create life-changing wealth.

Just ask shareholders of Alexion Pharmaceuticals Inc. (NASDAQ: ALXN)…

penny stock

On Sept. 24, 2002, ALXN was trading for just $2.78 per share. Today (Oct. 10), the Alexion stock price opened at $129.56 per share.

It took some time, but early investors have cleaned up with a 4,560% return.

That means for every $1,000 invested, you would have made roughly $45,000.

And that’s just one example of stocks trading under $6 making people wealthy…

On April 23, 2003, you could have bought shares of Regeneron Pharmaceuticals Inc. (NASDAQ: REGN) for $5.87 per share. If you still owned it this morning, you would have a big smile on your face when you saw shares opening at $390.60.

It took 15 years, but no one would complain about a 6,554% return.

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Every $1,000 invested in REGN back in April 2003 would now be worth roughly $65,000.

Every $10,000 would be worth $650,000.

You get the picture.

Of course, you’re not always going to hit it out of the park buying penny stocks, and you should never risk money you can’t afford to lose.

If you invest in a penny stock, you have to be comfortable with the idea of never seeing your hard-earned money again.

If you understand the risks, then we wanted to share a potential profit opportunity that could yield a 600% return.

And that’s just in the next 12 months.

You see, analysts believe this Chinese penny stock could go vertical as it taps into one of China’s most lucrative markets…

One Chinese Penny Stock to Watch for the Rest of 2018

The company that popped up on our radar is China-based Renren Inc. (NYSE: RENN). Founded in 2002, Renren operates two distinct businesses: social networking and auto services.

Yes, at first, this sounds like a company with a lack of focus.

But here’s why analysts project there could be a massive profit opportunity ahead…

In Q2, Renren’s revenue soared 582% to $135 million. Auto sales accounted for 91% of that $135 million, and the demand for secondhand vehicles in China is booming.

And Renren is in the pre-owned car market at the perfect time.

Since 2010, sales of used cars in China have been grown faster than sales of new cars, according to Bloomberg. In 2017, used car sales climbed 19.3%, while new ones only grew 3.2%.

Used auto sales look like the business to be in.

But what about Renren’s social media network?

Internet value-added services climbed 19% to $12.1 million in Q2. Although its social media site has significant competition from services like Weibo and WeChat, Renren still has 31 million monthly unique logins, according to SixthTone.com.

That could make it an attractive acquisition target for companies like Alibaba Group Holding Ltd. (NYSE: BABA) and Tencent Holdings Ltd. (OTCMKTS: TCEHY), which are trying to gobble up every business they can in Asia.

Again, this is a risky company because of its divided attention.

But if it can turn around the social media business (or find a buyer for it) and take advantage of booming used car sales in China, analysts believe the RENN stock price could skyrocket.

Trading at $1.39 this morning, Yahoo Finance reports analysts expect the RENN stock price to climb to $10.60 in the next 12 months.

That’s a potential profit of 662%.

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