Groupon (GRPN)

kmiklas

kmiklas

Groupon (Nasdaq:GRPN) has really got my eye. With $2B in market cap, a strong Web presence, good brand recognition, solid Q2 earning report, and a surprisingly low price ($5.87 at this time), I see it as a great buyout for a company looking to increase its Web presence.

I want to do more fundamental analysis on this one.

Discuss?
 
lol, I just responded that I would start a thread here for ya.

I just had a discussion with someone who told me she, and everyone she knows uses it. Me personally... I don't buy anything, I'm cheap. But I do like getting inputs from real people, not analysts.

My questions, as I know very little about it besides what I can see on a balance sheet, are:

1) How many unique visitors do they get per month and
2) Is that number consistently growing at a nice clip over time.

I have never even looked at this puppy so question number three here is really naive, but what is their revenue model? Do they get a percentage of each sale. Is that graduated or a flat rate? How do potential sellers sign up? I mean the mom and pop Mexican restaurant down the street has coupons on it.

Lots of questions.... but look at Square.... its losing money but it just popped nicely. Not an apples to apples comparison, just more of a "how the Wall Street herd" plays these things.

more to follow.
 
vanzandt said:
I have never even looked at this puppy so question number three here is really naive, but what is their revenue model? Do they get a percentage of each sale. Is that graduated or a flat rate? How do potential sellers sign up? I mean the mom and pop Mexican restaurant down the street has coupons on it.

Lots of questions.... but look at Square.... its losing money but it just popped nicely. Not an apples to apples comparison, just more of a "how the Wall Street herd" plays these things.
More...
Thanks vanzandt. In these days of HS/HFT, scalping, and a general preference for quantitative analysis, it's always encouraging to see someone showing an interest in fundamentals.

Good questions! It's ultimately a marketing company. Groupon provide an overview of their business model on their Web site:
https://www.groupon.com/merchant/article/how-groupon-makes-money

I realize another nice thing about this company: their service is easily sampled, both on the buy and sell side. The buy is super-easy; just buy an offer for that Mexican place and go out to eat. On the sell-side it seems possible to sign up as a business and offer something as a merchant. Either run an ad for a friend with a business, or walk down main street and ask one of the business owners if they want to try.

They must be doing something right: $2B is not chump change (well, not for me, at least).
 
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kmiklas said:
They must be doing something right: $2B is not chump change (well, not for me, at least).
More...


There are plenty of over valued but unprofitable companies. The cost of entering the business is very low, that equals lots of competition. Dozens of similar companies exist. Businesses hate groupon users, the only justification is for brand new businesses who want quick exposure.

They will die a fairly quick death... This puppy was 2 bucks a few months ago for a reason...In 5 years from 30 to 2...

Yeah, they must be doing something right... :)
 
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