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Groupon (GRPN) Falls More Steeply Than Broader Market: What Investors Need to Know

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In the latest trading session, Groupon (GRPN - Free Report) closed at $22.33, marking a -2.02% move from the previous day. This move lagged the S&P 500's daily loss of 0.55%. At the same time, the Dow lost 0.19%, and the tech-heavy Nasdaq lost 0.95%.

Coming into today, shares of the online daily deal service had lost 12.88% in the past month. In that same time, the Retail-Wholesale sector gained 1.22%, while the S&P 500 gained 3.64%.

The upcoming earnings release of Groupon will be of great interest to investors. The company's earnings per share (EPS) are projected to be $0.01, reflecting a 96.97% decrease from the same quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $121.88 million, indicating a 6.47% increase compared to the same quarter of the previous year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $0.8 per share and revenue of $504.5 million. These totals would mark changes of +152.98% and +2.42%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Groupon. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has moved 31.11% higher. Groupon is currently sporting a Zacks Rank of #1 (Strong Buy).

In terms of valuation, Groupon is presently being traded at a Forward P/E ratio of 28.49. This denotes a premium relative to the industry average Forward P/E of 21.61.

The Internet - Commerce industry is part of the Retail-Wholesale sector. Currently, this industry holds a Zacks Industry Rank of 74, positioning it in the top 30% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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