Groupon (GRPN) AI Stock Analysis

• Market Cap: $392.77M
• Dividend Yield: N/A
• Average Volume (3M): 1.17M
• Price to Earnings (P/E): ―
• Beta (1Y): 2.13
• Revenue Growth: -0.76%
• EPS Growth: -635.75%
• Country: US
• Employees: 2,079
• Sector: Communication Services
• Sector Strength: 97
• Industry: Internet Content & Information
• EPS (TTM): 0.21
• Shares Outstanding: 40,743,492
• 10 Day Avg. Volume: 1,663,191
• 30 Day Avg. Volume: 1,171,973
• PEG Ratio: -0.23
• Price to Book (P/B): -16.67
• Price to Sales (P/S): 1.42
• P/FCF Ratio: 14.23
• Enterprise Value/Market Cap: 1.14
• Enterprise Value/Revenue: 0.90
• Enterprise Value/Gross Profit: 1.01
• Enterprise Value/Ebitda: 14.15
• 1Y Price Target: $23.33
• Price Target Upside: 142.01% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 0.68
• Revenue Forecast (FY): $540.83M

• Rating: 45 Neutral
• Price Target: $9.50 ▼(-1.45% Downside)
• Action: Reiterated Date: 03/13/26
• Date: Action: Reiterated 03/13/26

The score is held down primarily by weak financial quality (ongoing losses and negative equity) and bearish technicals (price below all key moving averages with negative MACD). Offsetting these, the earnings call points to improving operating momentum (billings growth, EBITDA/FCF strength) and recent cash-flow positivity, but valuation remains constrained by lack of profitability and no dividend support.

Positive Factors

Core local billings growth

Groupon's hyperlocal marketplace is scaling: local services now constitute 89% of billings and grew 18% YoY. That concentration in a repeatable local model supports durable network effects, merchant relationships, and predictable demand for the next several quarters.

Positive cash generation and EBITDA

Adjusted EBITDA of $18M and trailing 12-month free cash flow of $60M signal a meaningful shift to cash-positive operations. Consistent cash generation enhances liquidity, funds reinvestment in platform and marketing, and reduces dependence on external financing over the medium term.

Platform conversion and tech improvements

A 13% YoY improvement in deal page conversion indicates effective platform modernization and AI-driven enhancements. Structural conversion gains increase revenue per visit, improve unit economics, and support margin sustainability even if total traffic growth is uneven.

Negative Factors

Negative shareholders' equity

Equity turning negative materially weakens the balance sheet and creditor cushion. Negative equity and higher debt limit borrowing capacity, elevate refinancing and covenant risk, and constrain strategic flexibility for investments, M&A, or shareholder returns over the medium term.

Persistent net losses

Despite revenue recovery and high gross margins, persistent net losses (2022–2025) and a ~-16.8% 2025 net margin indicate the company has not yet converted gross profitability into sustainable bottom-line profits. Ongoing losses erode retained earnings and limit long-term capital allocation options.

Declining SEO traffic

A structural decline in SEO-sourced traffic reduces low-cost organic acquisition. If organic reach does not recover, Groupon may need higher paid marketing to sustain growth, raising customer acquisition costs and pressuring margins and free cash flow durability over the coming quarters.

Groupon Business Overview & Revenue Model

Company Description

Groupon, Inc., together with its subsidiaries, operates a marketplace that connects consumers to merchants. It operates in two segments, North America and International. The company sells goods or services on behalf of third-party merchants; and first-party goods inventory. It serves customers through its mobile applications and websites. The company was formerly known as ThePoint.com, Inc. and changed its name to Groupon, Inc. in October 2008. Groupon, Inc. was incorporated in 2008 and is headquartered in Chicago, Illinois.

How the Company Makes Money

Groupon primarily makes money by earning revenue from transactions facilitated on its marketplace. When a customer buys a deal, Groupon collects payment and recognizes revenue based on its role in the transaction: (1) Marketplace/commission economics: Groupon typically retains a portion of the amount paid by the customer (often described as a commission or “take rate”) and remits the remainder to the merchant; this retained portion is a key revenue stream. (2) Promotional and advertising-like value to merchants: Merchants use Groupon as a customer acquisition and demand-generation channel by offering discounted vouchers or promotional pricing; Groupon monetizes this by charging for access to its consumer audience through the commission structure and related marketplace fees where applicable. (3) Other/ancillary revenues: To the extent offered in specific periods or geographies, Groupon may generate revenue from product-focused offerings (e.g., goods sold via the platform) and from various fees associated with platform usage; if specific current figures or breakdowns are required, they are null without referencing a specific filing or period. Key factors influencing earnings include the volume of transactions (number of vouchers/deals sold), average order value, the effective take rate, consumer repeat purchase behavior, and merchant supply/retention; partnerships are primarily with local merchants that provide the underlying services or products sold through the platform.

Groupon Financial Statement Overview

Summary

Mixed fundamentals. Revenue rebounded strongly in 2025 and gross margins are very high, with operating/free cash flow positive in 2024–2025. However, persistent net losses and a return to negative equity in 2025 materially increase financial risk and limit flexibility; segment KPIs also show heavy reliance on the Local business, increasing concentration risk.

Income Statement

Revenue rebounded in 2025 (annual revenue growth of ~46.9%) after declines in 2022–2024, and gross margin remains exceptionally high (~90% in 2024–2025). However, profitability is still weak: net losses persisted from 2022 through 2025, with 2025 net margin around -16.8%. EBITDA margin improved versus 2024, but overall earnings quality remains pressured by the inability to translate strong gross profit into consistent bottom-line profitability.

Balance Sheet

Leverage and capitalization are the key concerns. Stockholders’ equity turned negative in 2025 (after being positive in 2024), which weakens the balance sheet and makes debt metrics less meaningful/less favorable. Total debt increased in 2025 versus 2024, and the company’s returns for equity holders have been volatile due to losses and swings in equity levels. While total assets are relatively stable, the negative equity position materially raises financial risk.

Cash Flow

Cash generation improved meaningfully versus earlier years: operating cash flow and free cash flow were positive in both 2024 and 2025, a notable shift from the deeply negative figures in 2021–2023. That said, free cash flow declined in 2025 (down ~17% year over year), and with continued net losses, the sustainability of cash generation bears monitoring. Overall, cash flow is currently a relative strength, but it has not yet established a long, steady track record.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	498.42M	492.56M	514.91M	599.09M	967.11M
Gross Profit	443.47M	444.31M	450.66M	522.82M	737.12M
EBITDA	31.56M	9.04M	23.51M	-114.93M	178.05M
Net Income	-83.52M	-59.03M	-55.41M	-237.61M	118.67M
Balance Sheet
Total Assets	670.41M	612.69M	570.96M	793.12M	1.16B
Cash, Cash Equivalents and Short-Term Investments	296.08M	228.84M	141.56M	281.28M	498.73M
Total Debt	349.60M	252.93M	278.75M	346.76M	414.21M
Total Liabilities	712.80M	571.64M	611.27M	784.26M	947.59M
Stockholders Equity	-42.56M	40.81M	-40.63M	8.47M	209.87M
Cash Flow
Free Cash Flow	49.87M	39.97M	-97.27M	-174.83M	-176.72M
Operating Cash Flow	64.50M	55.89M	-77.98M	-135.99M	-123.96M
Investing Cash Flow	6.42M	-6.81M	-1.40M	-38.84M	-45.81M
Financing Cash Flow	-7.51M	47.79M	-35.69M	-34.41M	-183.85M

Groupon Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 9.64
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GRPN, the sentiment is Negative. The current price of 9.64 is below the 20-day moving average (MA) of 12.12, below the 50-day MA of 13.99, and below the 200-day MA of 22.48, indicating a bearish trend. The MACD of -0.94 indicates Positive momentum. The RSI at 22.12 is Positive, neither overbought nor oversold. The STOCH value of 12.31 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GRPN.

Groupon Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
YELP	71 Outperform	$1.42B	13.22	19.96%	―	5.35%	33.74%
FVRR	64 Neutral	$385.60M	34.17	5.27%	―	12.68%	133.00%
TBLA	61 Neutral	$860.56M	33.98	4.51%	―	10.96%	―
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
MAX	55 Neutral	$639.80M	28.43	-477.82%	―	64.86%	-112.92%
NXDR	51 Neutral	$608.73M	-14.97	-12.56%	―	6.65%	50.32%
GRPN	45 Neutral	$392.77M	-8.50	6142.31%	―	-0.76%	-635.75%

Groupon Corporate Events

Groupon Resolves Longstanding Italian Tax Disputes with Settlement

On December 29, 2025, Groupon’s Italian subsidiary, Groupon S.r.l., entered into a binding framework agreement with the Italian tax authorities, definitively resolving tax disputes dating back to at least 2012. The settlement totals approximately $25.2 million, including amounts previously paid, with a final payment of about $33,000 due in the first quarter of 2026; the company does not expect further material obligations related to these assessments, anticipates no material change to its accrued expenses for the fourth quarter of 2025, and expects a roughly $15 million reduction in free cash flow from the settlement payments. Separately, on December 22–23, 2025, the board’s compensation committee approved and executed an amendment to CEO Dušan Šenkypl’s Performance Share Unit award agreement to correct an administrative error regarding the tax treatment of PSUs that vested on August 11, 2025, clarifying that the change is purely administrative, does not alter the number of units or shares, does not materially change vesting conditions, and provides no additional economic benefit or new compensation arrangement.

The most recent analyst rating on (GRPN) stock is a Buy with a $42.00 price target. To see the full list of analyst forecasts on Groupon stock, see the GRPN Stock Forecast page.