groupon (Photo credit: Sean MacEntee) Rising revenue is usually good news for shareholders, as it demonstrates competitive strength boosting the company’s equity price. That’s not the case for Groupon’s (NASDAQ:GRPN) revenue that climbed 45 percent, to $568.3 million, however. The stock was sharply lower in after hours trading. What makes investors nervous about [...]
By James Kwak
Groupon plans to go public later this week. According to the latest leaks, things are going well: the IPO valuation, scaled back from $30 billion to about $12 billion, may be raised because of a successful road show. Apparently even after the company conceded that the amount they pay to a merchant does not count as revenue, investors have decided they like what they see.
But there is still something fishy about Groupon’s business model.
By Rocky Agrawal:Groupon (GRPN) was forced to restate fourth quarter earnings, sending its stock down 6% in after-hours trading. This surprised me as much as my $2 investment in the Mega Millions jackpot not paying off.
A little more than two years ago, Groupon was the apple of the startup community’s eye. It had turned down a $6 billion acquisition offer from Google and was headed for a remarkable IPO. Today, no one really knows what Groupon’s future holds. But it doesn’t look good.
Online discount service Groupon continues to grow at a rapid clip, but the company is still losing money, posting a $42.7 million loss for the fourth quarter of 2011. Groupon shares fell over 15% in after-hours trading Wednesday to $20.82, just slightly higher than the level at which the company went public in November.