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Quepasa’s Latin social network has 80% upside, analyst says (QPSA, GOOG)

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Social media technology company Quepasa Corporation ( QPSA , quote ) is attracting analyst attention as it positions itself to grow in the Latin American and Central American markets. Rodman & Renshaw recently initiated coverage on the company, assigning it a "Market Outperform / Speculative Risk" rating and a $7.00 price target. The stock has been trading below $5.00 since August 2011, and closed at $3.89 on December 5, so this would entail a significant 80% in upside potential. Analyst Amit Dayal of Rodman & Renshaw says Quepasa has had a volatile year due to market gyrations, a strategic acquisition and the excitement over social media investing. He sees Quepasa as "attractively positioned" for expansion, with a substantially larger user base and new products in the mobile space, but warns that the company is in a highly competitive industry. Quepasa is a survivor of the first dot-com boom and bust, having established itself in 1997 as a web applications developer. In 2008, it repositioned itself as a Latino social network, and now claims 35 million members worldwide. As the Florida-based company's name implies, it is strongest in Spanish-speaking countries. Orkut, the social network owned by Google ( GOOG , quote ), is the leader in Brazil, with 39 million of its global total of 66 million users in that key emerging market. Last month, QPSA merged with Insider Guides, Inc., owner of myYearbook.com. Quepasa plans to use myYearbook's technology to expedite mobile development. Quepasa also publishes "Wonderful City Rio," a Facebook game made entirely in Brazil that attracts about 120,000 players per day, which gives it a social gaming edge as well.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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