Groupon (GRPN) AI Stock Analysis

• Market Cap: $1.31B
• Dividend Yield: N/A
• Average Volume (3M): 1.75M
• Price to Earnings (P/E): 35.5
• Beta (1Y): 1.57
• Revenue Growth: -5.76%
• EPS Growth: 21.27%
• Country: US
• Employees: 2,079
• Sector: Communication Services
• Sector Strength: 89
• Industry: Internet Content & Information
• EPS (TTM): 0.17
• Shares Outstanding: 39,816,140
• 10 Day Avg. Volume: 1,188,736
• 30 Day Avg. Volume: 1,749,772
• PEG Ratio: 0.55
• Price to Book (P/B): 11.66
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 11.73
• Enterprise Value/Market Cap: 0.41
• Enterprise Value/Revenue: 0.27
• Enterprise Value/Gross Profit: 1.22
• Enterprise Value/Ebitda: 6.14
• 1Y Price Target: $25.50
• Price Target Upside: -21.80% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

• Rating: 52 Neutral
• Price Target: $33.00 ▲(1.20%Upside)

Groupon's overall stock score is primarily influenced by its financial struggles, characterized by declining revenue and high debt levels. Positive earnings call insights and strong market momentum provide some optimism, but poor valuation metrics limit the stock's attractiveness.

Positive Factors

Business Transformation

The company is showing solid progress as it continues its major transformation from its old legacy business.

Financial Performance

Billings and Adj. EBITDA exceeded the high-end of the guide in Q1, led by North America Local Billings accelerating to +11% YoY, the first quarter of double-digit growth in the business since 2017.

Negative Factors

Consumer Spending Volatility

There is mounting risk of volatility in discretionary consumer spending, which could impact demand for local services more broadly.

Risk-Reward Ratio

The recent sharp increase in the share price, with GRPN now trading at 13x NTM Street Adj. EBITDA, is negatively impacting the risk-reward ratio.

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 makes money primarily through the sale of vouchers and deals that offer discounts on local services, goods, and travel. The company generates revenue by taking a commission on each deal sold, which is a percentage of the price paid by the consumer. Additionally, Groupon earns money through its Goods segment, where it sells merchandise directly to consumers, and the Travel segment, offering discounted travel packages and hotel stays. Key revenue streams include local deals, Groupon Goods, and Groupon Getaways. Partnerships with local businesses, as well as marketing and promotional strategies to attract both merchants and consumers to its platform, significantly contribute to its earnings.

Groupon Financial Statement Overview

Summary

Groupon is facing significant financial challenges with declining revenue and persistent net losses. High debt levels and low equity increase financial risk, although recent cash flow improvements offer some optimism.

Income Statement

Groupon's revenue has been declining with a notable drop from $967 million in 2021 to $486 million TTM. The company has been struggling with profitability, evidenced by negative net income margins consistently over the years, reaching -8.13% TTM. Gross profit margins remain strong at 90.4% TTM, but significant EBIT and EBITDA margin declines reflect operational challenges.

Balance Sheet

The balance sheet shows high leverage with a debt-to-equity ratio of 5.49 TTM, indicating significant financial risk. Stockholders' equity is low, though the equity ratio improved slightly to 7.48% TTM. The company has been reducing total assets and liabilities, but equity remains weak, suggesting vulnerability to financial instability.

Cash Flow

Groupon's cash flow from operations improved to $65.98 million TTM from previous negative figures. Free cash flow has seen positive growth, reaching $50.37 million TTM, indicating better cash management. However, fluctuations in cash flow figures and past negative free cash flows highlight potential volatility.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
486.66M	492.56M	514.91M	599.09M	967.11M	1.42B
	Gross Profit
440.05M	444.31M	450.66M	522.82M	737.12M	677.29M
	EBIT
3.31M	8.79M	-18.25M	-47.75M	79.14M	116.25M
	EBITDA
1.58M	9.04M	23.51M	-114.93M	178.05M	-173.35M
	Net Income Common Stockholders
-39.58M	-59.03M	-55.41M	-234.38M	118.67M	-286.56M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
666.87M	228.84M	141.56M	281.28M	498.73M	850.59M
	Total Assets
1.28B	612.69M	570.96M	793.12M	1.16B	1.41B
	Total Debt
514.38M	252.93M	278.75M	309.23M	382.15M	520.42M
	Net Debt
-152.49M	24.09M	137.19M	27.95M	-116.58M	-330.17M
	Total Liabilities
1.09B	571.64M	611.27M	784.26M	947.59M	1.30B
	Stockholders Equity
191.20M	40.81M	-40.63M	8.47M	209.87M	107.67M
Cash Flow		Free Cash Flow
50.37M	40.56M	-99.80M	-174.83M	-176.72M	-116.55M
	Operating Cash Flow
65.98M	55.89M	-77.98M	-135.99M	-123.96M	-63.60M
	Investing Cash Flow
-6.62M	-6.81M	-1.40M	-38.84M	-45.81M	-20.12M
	Financing Cash Flow
11.99M	47.79M	-35.69M	-34.41M	-183.85M	176.80M

Groupon Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 32.61
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GRPN, the sentiment is Positive. The current price of 32.61 is above the 20-day moving average (MA) of 28.92, above the 50-day MA of 22.91, and above the 200-day MA of 14.38, indicating a bullish trend. The MACD of 2.95 indicates Negative momentum. The RSI at 72.98 is Negative, neither overbought nor oversold. The STOCH value of 79.88 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GRPN.

Groupon Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EVER	74 Outperform	$917.29M	25.19	32.17%	―	113.43%	―
SSTK	70 Outperform	$621.17M	16.23	7.07%	6.92%	10.30%	-57.87%
ANGI	68 Neutral	$791.30M	15.94	5.05%	―	-16.79%	―
Sector *	61 Neutral	$14.78B	5.89	-4.32%	3.67%	2.75%	-30.30%
GRPN	52 Neutral	$1.31B	35.54	-90.27%	―	-5.76%	21.27%
SEAT	51 Neutral	$354.44M	25.25	-1.00%	―	0.82%	-102.72%
KIND	51 Neutral	$619.79M	―	-18.77%	―	12.01%	35.71%

Groupon Corporate Events

Groupon CEO to Discuss Strategy at Fireside Chat

Groupon, Inc. is set to participate in the Northland Capital Markets Fireside Chat, where CEO Dusan Senkypl will discuss the company’s recent performance and future strategy. Despite facing risks such as global economic uncertainties and competition, Groupon remains focused on empowering customers with unique experiences at unbeatable value. With a presence in 14 countries and partnerships with over 50,000 merchants, Groupon aims for significant growth in billings, leveraging new revenue streams and geographic expansion.