Rakuten (OTCMKTS:RKUNY) Shares Gap Up - Should You Buy?

Key Points

• Shares gapped up — RKUNY opened at $4.95 after closing at $4.695 and last traded at $5.00 on a volume of about 8,912 shares.
• Analyst sentiment is mixed — Zacks downgraded Rakuten to a "strong sell," while two analysts rate it Strong Buy and one Sell, giving a MarketBeat average rating of "Buy."
• Fundamentals show weakness despite a revenue beat — The company missed EPS expectations (‑$0.08 vs. ‑$0.04), has negative net margin (‑7.13%) and ROE (‑14.73%), though revenue topped estimates at $4.61B; leverage is high with a debt-to-equity ratio of 4.11.

Rakuten, Inc. (OTCMKTS:RKUNY - Get Free Report) shares gapped up prior to trading on Monday . The stock had previously closed at $4.6950, but opened at $4.95. Rakuten shares last traded at $5.00, with a volume of 8,912 shares.

Analyst Upgrades and Downgrades

Separately, Zacks Research cut Rakuten from a "hold" rating to a "strong sell" rating in a report on Wednesday, March 4th. Two investment analysts have rated the stock with a Strong Buy rating and one has given a Sell rating to the company. Based on data from MarketBeat.com, the stock presently has an average rating of "Buy".

Rakuten Price Performance

The company has a current ratio of 1.16, a quick ratio of 1.16 and a debt-to-equity ratio of 4.11. The firm has a market cap of $10.47 billion, a price-to-earnings ratio of -8.93 and a beta of 1.20. The stock's fifty day moving average price is $5.32 and its 200-day moving average price is $5.95.

Rakuten (OTCMKTS:RKUNY - Get Free Report) last announced its quarterly earnings results on Thursday, February 12th. The company reported ($0.08) EPS for the quarter, missing the consensus estimate of ($0.04) by ($0.04). Rakuten had a negative net margin of 7.13% and a negative return on equity of 14.73%. The business had revenue of $4.61 billion during the quarter, compared to analyst estimates of $4.15 billion. As a group, equities research analysts forecast that Rakuten, Inc. will post 0.06 earnings per share for the current fiscal year.

About Rakuten

Rakuten, Inc is a diversified internet services company based in Tokyo, Japan, and founded in 1997 by Hiroshi Mikitani, who continues to serve as chairman and chief executive officer. Originally established as an online marketplace, Rakuten has expanded its reach to become a global technology group offering a wide range of digital services and consumer-facing platforms. The company is listed in Japan but its American depositary receipts trade over the counter under the symbol RKUNY.

At the core of Rakuten's business is its e-commerce marketplace, Rakuten Ichiba, which hosts millions of merchants and serves tens of millions of customers across Japan and other key markets.

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