The stock of Groupon (GRPN) is up 33% after the e-commerce company reported a surprise profit for this year’s first quarter.
The Chicago-based company announced a profit of $0.17 per share. Wall Street was expecting a loss of -$0.10 a share for the January through March quarter. Revenue in Q1 totaled $117.19 million, which topped the consensus estimate of $115.67 million among analysts who track the company’s progress.
The better-than-expected results have GRPN stock up more than 30% on May 8, its best one-day performance since the onset of the Covid-19 pandemic five years ago. Management at Groupon say consumers are once again flocking to its marketplace to find discounts and deals on local goods and services.
Immune to Tariffs
Businesses in more than 250 cities worldwide offer deals on their products and services through Groupon, and consumers purchase those deals on the company’s platform. Analysts say Groupon has been reinvigorated as consumers seek out deals amid tariff anxiety and as prices rise in the U.S. and abroad.
Also, because Groupon is locally focused in the markets in which it operates it is largely immune to import tariffs and trade barriers. With a market capitalization of $890 million, Groupon is known as a “micro-cap” stock. After falling sharply coming out of the pandemic, GRPN stock has been on fire lately, having risen 87% this year.
Is GRPN Stock a Buy?
The stock of Groupon has a consensus Strong Buy rating among three Wall Street analysts. That rating is based on three Buy ratings assigned in the last three months. The average GRPN price target of $20 implies 11% downside risk from current levels. These ratings may change after the company’s financial results.
