Groupon (Nasdaq:GRPN) is about to release earnings. Ponder this Bear Case Scenario:
Advertising is cyclical. Up and down with the economy. First to cut last to be spent.
Groupon only offers coupons which is only one aspect of marketing. Brand building or deep client relationships are not created by 15% off coupons which expire soon.
Groupon targeting is suspect. they keep offering me nail extensions from a shop ten miles away. I am a single white straight male with grey hair know what I mean. But no offers of single malt scotch, jazz music or anything really cool from my grandkids. I’m not sure they understand the grandparent dynamic. As in cash comes out of my pocket rather easily for them.
The forward PE is around 27. When is this sucker gonna generate some cash instead of promises for tomorrow.
Still well below historical prices. does not act like a growth stock should.
George Gutowski writes from a caveat emptor perspective.