GRPN
Groupon Inc
TMT, Consumer
04/17/2015
Presented
| Date | 04/14/2015 |
| Price | $7.25 |
| Market Cap | $4.90B |
| Ent Value | $3.86B |
| P/E Ratio | N/A |
| Book Value | $1.13 |
| Div Yield | N/A |
| Shares O/S | 675.36M |
| Ave Daily Vol | 11,470,000 |
| Short Int | 8.77% |
Current
| Price | $10.76 |
| Market Cap | $0.43B |
| Groupon, Inc. operates online local commerce marketplaces that connect merchants to consumers by offering goods and services at a discount worldwide. It also offers deals on products for which it acts as the merchant of record. The company offers deals in various categories, including food and drink, events and activities, beauty and spa, health and fitness, home and garden, and automotive; deals on various product lines comprising electronics, sporting goods, jewelry, toys, household items, and apparel; features travel offers comprising hotels, airfare, and package deals; and tools, such as payments and credit card payment processing service, as well as point-of-sale solutions to merchants. It distributes its deals to customers through mobile applications and mobile browsers that enable consumers to browse, purchase, manage, and redeem deals on their mobile devices; Websites; emails that are targeted by location, purchase history, and personal preferences; and search engines and others. The company was formerly known as ThePoint.com, Inc. and changed its name to Groupon, Inc. in October 2008. Groupon, Inc. was founded in 2008 and is headquartered in Chicago, Illinois. |
Please note, this idea was updated on 5/7/2015 and can be read here: Long - Groupon Inc (GRPN),
Publicly traded companies mentioned herein: Groupon (GRPN), Amazon (AMZN), eBay (EBAY) and Overstock (OSTK)
Highlights
Shares of Groupon peaked soon following its 2011 IPO, with trends quickly and materially slowing thereafter. As the daily deals business declined, the company, in an effort to monetize the large base of users on its platform, started a goods business in 2012 with a focus on steeply discounted merchandise and the intention to compete with e-commerce players including Amazon (AMZN), eBay (EBAY) and Overstock (OSTK). The subscale goods business has been a poor performer thus far, barely profitable with gross margins in the 5-7% range. In spite of these apparent challenges, the presenter believes the stock may be poised to inflect, with company efforts underway to both improve the goods business and, crucially, continue to build out a more sustainable and higher margin local deals business. Groupon has effectively transitioned a small but growing percentage of its user base to more search oriented behavior, a move that has resulted in more frequent site visits and that the presenter believes should lead to rapidly expanding incremental gross margins.
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