Groupon Inc. (NASDAQ: GRPN) posted earnings that just didn’t please anyone outside of short sellers. While meeting earnings estimates at $0.01 per share, revenue growth of 23% to $751.6 million was short of the $761.8 million expected. While we have seen many analyst calls against Groupon on Wednesday, there are other concerns here.

Groupon may have ended its second quarter with $868.1 million in cash. The problem is that this is after it spent $106 million to repurchase 17,228,792 shares — and average price of $6.15 per share. This comes to an aggregate purchase price of $106 million spent. Now that shares tanked after earnings, you can argue that Groupon overpaid for its shares when it could have known it wasn’t going to please on earnings.

Groupon’s active customers are not measured the same as “active users” in social media, where they are measured as monthly active users. Groupon counts the active users as customers that have purchased a voucher or product within the past 12 months. In the second quarter that grew 25% year-over-year to 53.2 million, comprising 22.6 million in North America, 14.5 million in EMEA and 16.1 million in Rest of World. The trend was still up, but prior quarters (most recent first) were 51.8 million, 44.9 million, 43.5 million, 42.6 million and 41.7 million. After comparing the breakdown, we just are not that enthralled in user growth — nor on how those users are counted.

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We have seen unilateral earnings and revenue estimates cut from multiple firms. We have also seen more specific firms issue formal downgrades, or they just lowered their price targets. These are the analyst calls so far on Wednesday:

• Bank of America Merrill Lynch has a Neutral rating and cut the price target to $7.50 from $8.00.
• Credit Suisse has a Neutral rating and cut the price target to $6.50 from $10.00.
• Northland Securities has a Market Perform rating and cut the target to $6.00 from $7.00.
• RBC Capital Markets has an Underperform rating and cut the price target to $5.00 from $6.00.
• Wunderlich downgraded to Hold from Buy and cut the target price to $6.00 from $10.00.

Sterne Agee has remained the one bull, with a Buy rating and $12 price target. Still, it said that Groupon is now a “prove me” story and it lowered earnings estimates along with the rest of the firms.

If you want further evidence that Groupon is overpaying on its stock buybacks, here was the report from the prior quarter:

During the first quarter 2014, Groupon repurchased 3,075,700 shares of common stock at an average price of $9.58 per share for a total of $29.5 million. Under the existing authorization, Groupon has repurchased a total of 7,508,500 shares at an average price of $10.13 per share for a total of $76.0 million.

Groupon shares were down 16% at $5.93 on a whopping 38 million shares with right at three hours to go before Wednesday’s close. Groupon’s 52-week range is $5.18 to $12.76, and the stock trades an average of about 17 million shares per day.

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