Groupon, Inc. (NASDAQ: GRPN) operates online local commerce marketplaces that connect merchants to consumers by offering goods and services at a discount in North America and internationally.
On November 7th, Groupon reported mixed third-quarter results as the company missed estimates on revenue, but it beat estimates for net profit. The firm’s ongoing restructuring which includes less focus on the traditional voucher business is progressing a bit more slowly than expected. Decline in revenue from less vouchers was only partially offset by the faster growing card-linked offers made available through Groupon+ and online bookings of local events and services.
Recent Events
November 16, 2018. Groupon is turning 10, and the global marketplace for local services, experiences and goods is marking its decade evolution from a daily deals company into a local ecommerce leader. Groupon has brought back the most successful fundraising campaign ever launched via its platform, which provides people with the opportunity to donate to Vested Interest in K9s––an organization that provides bullet- and stab-protective vests for law enforcement dogs that put their lives in danger to protect their human partners in the line of duty. https://finance.yahoo.com/news/groupon-celebrates-turning-10-birthday-171900039.html
November 11, 2018. One newer initiative emphasizes a shift away from coupons and vouchers via the company’s new card-linked products. Whereas users traditionally would print out a Groupon voucher and present it to a restaurant if they wished to receive a discounted meal, newer card-linked Groupon+ offers allow people to register their credit cards in Groupon’s system and get automatic discounts by using those cards at establishments where they’ve unlocked Groupon deals.
Products
The company provides deals in various categories, including events and activities, beauty and spa, health and fitness, food and drink, home and garden, and automotive; and deals on various product lines, such as electronics, sporting goods, jewelries, toys, household items, and apparel, as well as provides discounted and market rates for hotel, airfare, and package deals. It offers its deal offerings to customers through Websites; search engines; mobile applications and mobile Web browsers, which enable consumers to browse, purchase, manage, and redeem deals on mobile devices; emails; affiliate channels; display advertising; and television and radio advertising.
About
Groupon, Inc. operates online local commerce marketplaces that connect merchants to consumers by offering goods and services at a discount in North America and internationally. The company provides deals in various categories, including events and activities, beauty and spa, health and fitness, food and drink, home and garden, and automotive; and deals on various product lines, such as electronics, sporting goods, jewelries, toys, household items, and apparel, as well as provides discounted and market rates for hotel, airfare, and package deals. It offers its deal offerings to customers through Websites; search engines; mobile applications and mobile Web browsers, which enable consumers to browse, purchase, manage, and redeem deals on mobile devices; emails; affiliate channels; display advertising; and television and radio advertising. The company was formerly known as ThePoint.com, Inc. and changed its name to Groupon, Inc. in October 2008. The company was founded in 2008 and is headquartered in Chicago, Illinois. Groupon, Inc. is a subsidiary of The Point, LLC.
Analysts
9 Wall Street analysts have issued ratings and price targets for Groupon in the last 12 months. Their average twelve-month price target is $5.1175, suggesting that the stock has a possible upside of 69.45%. The high price target for GRPN is $6.25 and the low-price target for GRPN is $4.00. There are currently 1 sell rating, 5 hold ratings and 3 buy ratings for the stock, resulting in a consensus rating of “Hold.”
Date Brokerage Action Rating Price Target
11/8/2018 B. Riley Lower Price Target Buy $6.30 ➝ $5.60
9/13/2018 Wedbush Reiterated Neutral $4.00
8/5/2018 Barclays Reiterated Sell $4.50
7/11/2018 Morgan Stanley Boost Target Equal Weight $4.60 ➝ $4.80
5/10/2018 UBS Group Upgrade Sell ➝ Neutral $2.90 ➝ $5.99
2/15/2018 JPMorgan Chase & Co. Lower Target Neutral $6.00 ➝ $5.00
2/15/2018 Goldman Sachs Group Reiterated Neutral $4.80
Source: marketbeat.com
Financial review
Q3 2018
Revenue $592.8M
Gross profit 305.9M
Operating expenses 252.9M
Net profit 47.1M
Cash on hand 572.3M
Shareholders’ equity 330.6M
Stock influences and risk factors
Their strategy to grow the business may not be successful and may expose them to additional risks.
Their international operations are subject to varied and evolving commercial and regulatory challenges, and the inability to adapt to the diverse and changing landscapes of international markets may adversely affect the business.
They may be subject to breaches of information technology systems, which could harm relationships with customers and merchants, subject them to negative publicity and litigation, and cause substantial harm to the business.
Government regulation of the Internet and e-commerce is evolving, and unfavorable changes or failure by the company to comply with these regulations could substantially harm the business and results of operations.
Stock chart
On Friday, November 16, 2018, GRPN shares closed at $3.02 per share on traded volume of 13.6 million shares. The current RSI (14) is 41.40 and GRPN has a market cap of $1.724 billion.
At $3.02 per share, GRPN shares are trading below their 50 DMA and 200 DMA of $3.49 and $4.32 respectively.
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