Groupon (GRPN) Gains As Market Dips: What You Should Know

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Groupon (GRPN) closed the latest trading day at $10.25, indicating a +1.18% change from the previous session's end. The stock exceeded the S&P 500, which registered a loss of 0.03% for the day. Meanwhile, the Dow experienced a drop of 0.61%, and the technology-dominated Nasdaq saw an increase of 0.56%.

The online daily deal service's shares have seen a decrease of 0.59% over the last month, surpassing the Retail-Wholesale sector's loss of 0.9% and falling behind the S&P 500's gain of 1.39%.

Analysts and investors alike will be keeping a close eye on the performance of Groupon in its upcoming earnings disclosure. The company is predicted to post an EPS of $0.06, indicating a 150% growth compared to the equivalent quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $119.02 million, down 5.89% from the prior-year quarter.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $0.47 per share and revenue of $511.06 million, indicating changes of +190.38% and -0.75%, respectively, compared to the previous year.

Any recent changes to analyst estimates for Groupon should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Groupon is holding a Zacks Rank of #2 (Buy) right now.

From a valuation perspective, Groupon is currently exchanging hands at a Forward P/E ratio of 21.55. For comparison, its industry has an average Forward P/E of 23.76, which means Groupon is trading at a discount to the group.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This industry, currently bearing a Zacks Industry Rank of 74, finds itself in the top 30% echelons of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.