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RAAS

Cloopen Group Holding NYSE:RAAS Stock Report

Last Price

US$0.75

Market Cap

US$123.7m

7D

-5.9%

1Y

-81.8%

Updated

03 Oct, 2022

Data

Company Financials
RAAS fundamental analysis
Snowflake Score
Valuation2/6
Future Growth0/6
Past Performance0/6
Financial Health4/6
Dividends0/6

RAAS Stock Overview

Cloopen Group Holding Limited, through its subsidiaries, provides cloud-based communications solutions in the People’s Republic of China.

Cloopen Group Holding Limited Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Cloopen Group Holding
Historical stock prices
Current Share PriceUS$0.75
52 Week HighUS$5.00
52 Week LowUS$0.55
Beta0
1 Month Change-31.57%
3 Month Change-30.30%
1 Year Change-81.82%
3 Year Changen/a
5 Year Changen/a
Change since IPO-98.43%

Recent News & Updates

Sep 16

Cloopen: A Clean Cloud, Or Still Under Stormy Skies?

Summary An internal investigation by cloud services provider Cloopen found the company inflated its revenue by about 5% in last year’s second and third quarters. The new China-U.S. information-sharing agreement could help restore investor confidence in such U.S.-listed Chinese companies. Cloopen shares dropped 7% after its announcement last week. But at their latest close of $1.01, we should also note the stock is up nearly 30% from where it traded. A couple of new announcements involving internal investigations results for two U.S.-listed Chinese companies are showing why we need the agreement reached last month giving the U.S. securities regulator authority to directly investigate such firms. The group has basically been allowed to self-police itself in the more than two decades since Chinese companies began listing in the U.S., which is hardly reassuring coming from a country where inflating data is almost an ingrained part of the business culture. The practice of inflating data certainly isn’t new, and seems to originate in China’s planned economic era where people were always trying to please their bosses by not only meeting, but often exceeding, their targets. Supervisors often claim ignorance in such situations and pin the blame on rogue underlings. But the reality is that people throughout such organizations are usually responsible, since bosses often pressure their underlings to achieve impossible targets and then pretend not to notice when they know the results they receive are probably exaggerated. Results of the latest internal investigations are coming from cloud services company Cloopen Group Holding Ltd. (RAAS) and retailer Miniso Group Holding Ltd. (MNSO; 9896.HK). Cloopen launched its investigation in May after its former auditor, the China affiliate of KPMG, uncovered evidence of revenue inflation and resigned. Miniso launched its investigation after a short seller accused the company in July of exaggerating its franchise model. These two internal investigations follow two similar ones, including one that we wrote about earlier this week involving online grocer Missfresh (MF), also alleging revenue inflation; and another more famous one in 2020 involving coffee chain Luckin (LKNCY), also involving revenue inflation on a massive scale. In all four cases, suspicions of wrongdoing came from short-seller reports or from the companies’ auditors. In each case, the U.S. Securities and Exchange Commission (SEC) was presumably relegated to the sidelines due to previous Chinese prohibitions banning it from conducting its own investigations. We’ll end the suspense now by saying Cloopen’s investigation found that revenue inflation did indeed occur, though it was less than initially suspected. Meanwhile, Miniso said its investigation found no evidence of wrongdoing. Investors didn’t seem too convinced by either report. Cloopen shares dropped 7% after its announcement last week. But at their latest close of $1.01, we should also note the stock is up nearly 30% from where it traded just before initial announcement of the investigation in May. That seems to indicate that perhaps investors are betting that Cloopen has cleaned up its act and they may be willing to have more faith in the company going forward. Miniso shares were down slightly in Thursday trade after it released its announcement clearing itself. But at its latest close of $5.50, the stock is now at roughly the level it tumbled to after short seller Blue Orca Capital issued its report accusing the company of misrepresenting its franchise model because many of its franchisees were, in fact, invested by the company’s owner. The stock last closed at $7.21 before the short-seller report’s release, meaning the lukewarm response to results of the investigation may show investors remain skeptical about the company. Less-than-expected revenue inflation With all that big-picture background, we’ll take a closer look at the findings of both reports, starting with Cloopen. The company raised $320 million in its New York IPO in February last year, making it one of the last major Chinese listings in New York before most such listings ground to halt starting around July last year. Somewhat ironically, the amount of money Cloopen raised is now roughly double the company’s latest market value of $166 million, showing just how far the stock has fallen from its IPO price of $16. Cloopen said its investigation found its revenue was inflated by 11.6 million yuan ($1.7 million) in last year’s second quarter, representing 4% of the total. The figure was inflated by 17.8 million yuan in the third quarter, or 6% of the total. While any inflation is never good, those figures were lower than the company’s original estimate saying that 5% to 10% of second quarter revenue and 15% to 20% of third quarter revenue might be bogus. Cloopen added the investigation also found that its costs and expenses were inflated by 9.2 million yuan and 1.8 million yuan in last year’s second and third quarters, respectively. The company hasn’t reported any financial results since last year’s third quarter due to the investigation. But it said in its latest announcement that its fourth quarter results from last year “would also fall significantly below its previously announced revenue guidance” of 328 million yuan to 333 million yuan given last November with its third quarter results. Cloopen said it has taken corrective measures, including closing some business departments involved in the fraud and getting rid of or disciplining employees involved. It added the investigation “did not uncover any evidence indicating that the company’s CEO or CFO had participated in the employee misconduct and transaction irregularities.”

Sep 07

Cloopen regains compliance with NYSE minimum price requirement

Cloopen Group (NYSE:RAAS) received letter from the NYSE on September 1, 2022 stating the company has regained compliance with the NYSE's continued listing standard for minimum share price. On May 31, 2022, the NYSE notified the company that it was not in compliance with minimum price requirement.

Jun 29

Cloopen receives NYSE non-compliance letter regarding ADS trading price

Cloopen Group (NYSE:RAAS) received NYSE non-compliance letter dated May 31, 2022, notifying the company that it is below compliance standards due to it's ADSs trading price. The applicable cure period for the company to regain compliance expires on November 30, 2022. The company must bring its share price and average share price back above $1.00 by six months following receipt of the notification.  The company can also demonstrate an accelerated cure based on a $1.00 share price on both the last trading day of any calendar month within the six-month cure period and the average share price over the 30 trading days preceding the end of that month. The company intends to monitor the market conditions of its listed securities and is still considering its options.

Shareholder Returns

RAASUS SoftwareUS Market
7D-5.9%2.1%1.0%
1Y-81.8%-29.4%-20.0%

Return vs Industry: RAAS underperformed the US Software industry which returned -33.3% over the past year.

Return vs Market: RAAS underperformed the US Market which returned -23.2% over the past year.

Price Volatility

Is RAAS's price volatile compared to industry and market?
RAAS volatility
RAAS Average Weekly Movement10.8%
Software Industry Average Movement8.7%
Market Average Movement6.8%
10% most volatile stocks in US Market15.5%
10% least volatile stocks in US Market2.8%

Stable Share Price: RAAS is more volatile than 75% of US stocks over the past 3 months, typically moving +/- 11% a week.

Volatility Over Time: RAAS's weekly volatility (11%) has been stable over the past year, but is still higher than 75% of US stocks.

About the Company

FoundedEmployeesCEOWebsite
20121,194Changxun Sunhttps://www.yuntongxun.com

Cloopen Group Holding Limited, through its subsidiaries, provides cloud-based communications solutions in the People’s Republic of China. The company offers a suite of cloud-based communications solutions, which include communications platform as a service solution that provides application programing interfaces and software development kits to embed messaging, voice call, audio and video, instant messaging, and other communications into enterprises' applications, services, and/or business processes; cloud-based contact centers, which offers RongCC and 7moor Cloud solutions; and cloud-based unified communications and collaborations, such as RongVideo that provides instant messaging, audio and video conferencing, and telephony solutions. It serves a customer base consisting of enterprises of various industries, including internet, telecommunications, financial services, education, industrial manufacturing, and energy.

Cloopen Group Holding Limited Fundamentals Summary

How do Cloopen Group Holding's earnings and revenue compare to its market cap?
RAAS fundamental statistics
Market CapUS$123.73m
Earnings (TTM)-US$905.10m
Revenue (TTM)US$142.43m

0.9x

P/S Ratio

-0.1x

P/E Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
RAAS income statement (TTM)
RevenueCN¥1.01b
Cost of RevenueCN¥586.52m
Gross ProfitCN¥426.74m
Other ExpensesCN¥6.87b
Earnings-CN¥6.44b

Last Reported Earnings

Sep 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)-39.17
Gross Margin42.12%
Net Profit Margin-635.47%
Debt/Equity Ratio0.0%

How did RAAS perform over the long term?

See historical performance and comparison