Groupon, Inc. (GRPN) Attempting To Corner The Market?

On December 03, 2019, Groupon, Inc. (NASDAQ:GRPN) shares lost 0% or 0 points to close at $2.8 with a thin trading volume of 3.606 million shares. It opened the trading session at $2.79, the shares rose to $2.85 and dropped to $2.77, the range by which the price of stock traded the whole day. The company now has a market cap of $1.59 billion and currently has 566.69 million outstanding shares. Groupon, Inc. (GRPN) stock has plunged -2.44 percent of market value in 21 trading days.

GRPN stock’s trailing 3-year beta is 1.33, meaning there will be a greater rate of return, although posing a higher risk. The part of a firm’s profit given to each outstanding share of regular stock was -$0.1 share in the trailing 52 weeks. The stock’s value fallen -12.5 percent year to date (YTD) compared to a decline of -8.79 percent in 52 week’s period. The firm’s shares are still trading -29.65 percent below its 1-year high of $3.98 and 21.21 percent up from 52-week low of $2.31. The average consensus ranking on the company is 3, on a ranging where 5 is equal to a consensus sell rating. In other words, the mean analyst recommendations are ranking this stock as a hold.

Groupon, Inc. (GRPN) is most likely going to rise 28.21 percent in the coming 12 months, as per price target approximations compiled by finviz. Nevertheless, they have set the price target at a $5-month high price target. This represents a whopping 78.57 percent increase from the current trading of shares. The 52-week median price target given by the analysts is $3.5, which means a return possibility of 25 percent in comparison with the closing price of the stock of $2.8 on December 03. The lowest price set for the stock is $2.8 — just above 0 percent from GRPN share price now.

Past records have indicated that shares in Groupon, Inc. declined on 16 different earnings reaction days and we have yet to see whether this trend will play out and remain in place when the company reports upcoming earnings. Investors will get the next hint of GRPN’s Q4 earnings on February 11. Analysts are predicting revenue to suffer decline of -11.2 percent to $710M in the financial fourth quarter, while EPS will soar by about 60 percent to $0.16 per share. In the last quarter, it earnings of -$0.03 per share came worse than the $0.12672, adjusted, expected by Thomson Reuters consensus estimate. Revenue for the quarter was $799.9M, topping the $782.54M analysts had expected. Earnings are seen to rise by -169.4 percent this year, 0.45 percent in the coming year and the trend continues by 9.48 percent every year in the next 5 years.

Let’s take a glimpse at some insider activity at Groupon, Inc. (NASDAQ:GRPN) and observe the pattern. The earliest insider trade happened on 08/30/2019. Bass Robert J gathered a total of 50 thousand shares of the firm at average share price of $2.58. The total amount for the purchase was set at $129 thousand. On completing this exchange, the Director account balance was 341.9 thousand shares. The stock grew 8.53 percent from that insider purchase. On 06/06/2019, LEFKOFSKY ERIC P, Director, 10% Owner, did a sale of 3 million shares at a price of $3.5 per share. This got rid of 10.5 million shares from the insider’s fortune and the stock experienced a -20 percent retreat in price since the news became public. This exchange saw 76.96 million shares get out from the Director, 10% Owner account.

On 03/07/2019, Director, 10% Owner LEFKOFSKY ERIC P recorded a sale transaction valued at $9.99 million. The sale at $3.33 a share has eliminated 3 million shares from the insider’s portfolio position. Meanwhile, shares price witnessed -15.92 percent decrease since the transaction reporting date. The company insider is left with 79.96 million shares remaining in the account. LEFKOFSKY ERIC P, who works as Director, 10% Owner at the company, performed a sale of 3 million shares in a transaction worth $9.21 million. The disposal recorded on 12/07/2018 was priced at $3.07 per share. The stock price plunged -8.79 percent since the transaction. LEFKOFSKY ERIC P currently holds a stake of 82.96 million in GRPN stock which is worth $232.27 million after the insider selling.

The stock is lingering around the initial support level of $2.76. After this, the following support is at the zone of $2.73. Up until the time the GRPN stock hit levels beyond the current one, bulls should have no alarm. In terms of its momentum, the stock’s RSI hit 46.07 on the daily chart, and this may be a cause for concern. In case the price goes below $2.73 level on closing basis, there may be more profit booking with the stock growing weaker. Still, getting to the $2.84 level may cause a pull-back move approaching $2.89 mark.

The industry GRPN deals with has an average P/E of 33.4. Its P/B ratio is standing at 5.3X compared to the 4.9 industry average. It is additionally sporting a 0.7 on the Price-to-Sales ratio, compared to the industry’s P/S average of 5.8. Groupon, Inc. has a 51.6% gross profit margin, with its operating margin around 2.6%. Alongside this, the company’s net profit margin currently stands at -2.2%.