Groupon (GRPN) Downgraded to Sell by StockNews.com Amid Mixed Analyst Views

In a recent development for online marketplace operator Groupon, Inc. GRPN, equity research analysts at StockNews.com have revised their rating from 'hold' to 'sell.' This rating adjustment was conveyed to investors in a research note released on Friday, illustrating a less favorable outlook for the company's stock.

Analyst Ratings Overview

Several analysts have offered their insights on GRPN over the past few months, leading to a diversified mix of opinions. Credit Suisse Group upgraded their price target on Groupon from $3.40 to $8.00 while maintaining a 'neutral' stance. Meanwhile, Barclays BCS raised their price target from $4.00 to $6.00 and categorized GRPN as 'underweight.' Amidst these varied positions, Roth MKM initiated coverage on the company, suggesting a 'buy' rating with a significant price objective of $30.00. In contrast, The Goldman Sachs Group adjusted their price target from $3.00 to $4.00, yet still held a 'sell' rating on Groupon.

The consensus among these analysts has pegged Groupon with a collective 'Hold' rating and an average target price of $12.00, illustrating a blend of cautious optimism and concern toward the company's expected performance.

Groupon's Market and Financial Performance

Groupon's stock commenced trading at $8.83 on the noted Friday, with a market capitalization of $275.77 million. Despite the market challenges, the stock has fluctuated between a 52-week low of $2.89 and a high of $16.25, reflecting significant volatility. Its moving averages suggest that the stock price has been fluctuating, with the 50-day average at $12.58 and the 200-day average at $8.66.

In terms of fiscal outcomes, GRPN reported quarterly earnings with EPS (Earnings Per Share) of ($0.30), outperforming the consensus estimates. The company's revenue for the same period was $129.11 million. However, Groupon also reported a negative net margin of 26.35% and a concerning negative return on equity of 523.08%, highlighting financial stress areas for the company.

Institutional Investment Activity in Groupon

Institutional investors have shown mixed activity with regard to GRPN. Mizuho Markets Americas LLC notably increased its position in the company by 96.6% during the 3rd quarter, while Citigroup Inc. C expanded its stake by an impressive 2,630.5%. Several other significant investment changes by Barclays and Lynwood Capital Management Inc. demonstrate the varied investor confidence level in Groupon's market prospects.

It is evident that hedge funds and institutional investors hold a significant portion of the company's stock, owning approximately 90.05% of GRPN. This demonstrates that while retail investors are involved in trading Groupon shares, large investors contribute substantially to the stock's market presence.

About Groupon

GRPN is a Chicago-based enterprise that provides a digital marketplace connecting consumers with a diverse array of merchants. It operates across both North American and International segments, offering goods and services from third-party merchants as well as managing first-party goods inventory. Central to Groupon's business model is its reliance on mobile applications and websites as platforms for user engagement and sales.

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