Can Groupon Get Its Earnings Right?

Groupon Inc. (NASDAQ: GRPN) is set to report its earnings Thursday after the markets close. Thomson Reuters has consensus estimates of $0.03 in earnings per share (EPS) and $908.38 million in revenue. In the fourth quarter of the previous year, the company posted $0.04 in EPS and revenue of $768.45 million.

At the beginning of February, Groupon was raised to Buy, all the way up from a Sell rating, at a boutique firm named Ascendiant Capital Markets. Shares tried to rally 2% initially following the call, but the realization that Ascendiant probably does not create millions on millions in share volume of new stock purchases based on its research kept the stock from running handily.

It is worth mentioning that coupon stocks were hit hard Tuesday morning following less than stellar earnings reports. In a business where cutting costs is the key, it would appear that both Inc. (NYSE: COUP) and RetailMeNot Inc. (NASDAQ: SALE) suffered on weaker-than-expected guidance.

24/7 Wall St has collected a few analyst calls on Groupon from the month of February so far:

  • Deutsche Bank has a Buy rating with a price target of $8.00.
  • Brean Capital has a Buy rating with an $11.00 price target.
  • B. Riley reiterated a Buy rating with a $9.50 price target.

The 50-day moving average is $7.50, and it is currently being tested. Groupon shares bounced off this moving average back in mid-December and then crossed under it in mid-January. At the same time, the 200-day moving average has remained under Groupon shares since their massive jump at the tail end of October. Shares bounced off the 200-day moving average twice since then, once in mid-December and then in late-January.

Shares of Groupon traded up 0.5% at $7.62 at midday Thursday. The stock has a consensus analyst price target of $8.61 and a 52-week trading range of $5.18 to $10.88.

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