Will Groupon Inc (NASDAQ:GRPN) Beat Analysts’ Expectations Again?

Posted on Oct 23 2013 - 8:40am by Viraj Shah

Boston, MA 10/23/2013 (wallstreetpr) - Groupon Inc (NASDAQ:GRPN) is feeling the heat. Analysts are warning that the company may see a drop in domestic revenues. They are predicting a drop in the third quarter as compared to the previous year. The August and September trends were disappointing. Investors dumped the stocks triggering the short-sale circuit breaker. The shares traded in the range of $9.51 and $10.25 before closing at $9.86, a fall of 6.93%.

Groupon has reported lower sales in markets other than North America in the last quarter. Revenues in North America had increased by 45%. There was a drop of 24 to 26% in the other markets. Groupon was able to get a surge in demand from smartphone users. The company had targeted this group and was well poised to generate growth as the U.S. had seen an increase in online sales. Mobile transactions accounted for about 50% of the company’s transactions in the second quarter. Online sales are expected to reach $248.7 billion by 2014 and the smartphone user base to 207.40 million by 2017. Analysts and investors will be watching the quarterly results closely to find out where the company faltered. The company is set to announce 3Q13 results on November 7, 2013 after the market closes.

Groupon had ended the second quarter with revenues of $608.7 million against analysts’ expectation of $606.20 million. The earnings per share were $0.02, in line with the analysts expectations. The company had also announced the appointment of Eric Lefkofsky as the new CEO and also a share repurchase program of $300 million. The turnaround strategy of the company was also showing results. The share prices of the company have swung widely following the quarterly results.

Groupon has managed to beat analysts’ expectation in the last three quarters. Investors would be hoping that the company lives up to its reputation and also does so for the current quarter.

Viraj Shah has done M.Com (Finance) and currently pursuing CFP. He is a technical analyst who tracks US markets along with other global markets like India very closely. He is very passionate about stocks and believes that money can always be made in market.

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