Does Groupon's Turnaround In Q4 Signal Recovery and Resolve Concerns?
Portfolio Pulse from Anusuya Lahiri
Groupon Inc (NASDAQ:GRPN) reported Q4 fiscal 2023 revenue of $137.7 million, surpassing consensus estimates but declining 7% Y/Y. Adjusted EPS was $0.30, beating expectations. Despite initial gains, GRPN shares later dropped. North America and International revenues fell due to decreased demand in Goods categories, with global billings and units sold also declining. However, adjusted EBITDA improved significantly, and the company's liquidity position strengthened. Analysts predict a significant downside for GRPN shares, with an average 1-year price target of $7.5, indicating a 59.02% expected downside. GRPN's stock traded lower by 3.85% in premarket trading.
March 15, 2024 | 1:29 pm
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NEGATIVE IMPACT
Groupon reported higher than expected Q4 revenue and EPS, with significant improvement in adjusted EBITDA and liquidity. However, analysts predict a significant downside for the stock.
Despite beating Q4 expectations, the significant expected downside from analysts and the premarket stock price decline indicate a negative short-term impact.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100
NEUTRAL IMPACT
Investors can gain exposure to Groupon's stock through the Global X E-Commerce ETF (EBIZ), which may be impacted by Groupon's performance.
As EBIZ provides exposure to Groupon, its performance could indirectly affect the ETF. However, the diversified nature of ETFs dilutes the impact of a single stock.
CONFIDENCE 70
IMPORTANCE 40
RELEVANCE 50
NEUTRAL IMPACT
The Global X Social Media ETF (SOCL) offers exposure to Groupon, and its performance may be influenced by Groupon's financial results and stock movement.
Given that SOCL includes Groupon, its performance and stock movement could have an indirect impact on the ETF, though the effect is likely to be limited due to diversification.
CONFIDENCE 70
IMPORTANCE 40
RELEVANCE 50