UPDATE: Morgan Stanley Reiterates on Groupon

In a report published Friday, Morgan Stanley analyst Scott Devitt reiterated an Overweight rating with a $14 PT on Groupon GRPN.

Groupon reports 3Q13 earnings on Thursday, November 7th. Morgan Stanley estimates a 26 percent gross billing growth for North America and 13 percent in Europe. The analyst estimates total revenue of $619 million versus $585-635 million guidance range.

Devitt commented, "CQ3 headline numbers could be weak but the stock still works in our view, if the source of the NA deceleration is the Goods business and the Local Deals segment shows improvement in NA and EMEA. We believe that the Deals segment growth represents a better measure of the health of the business, and we note that NA Goods segment laps a sizable uptick in growth last year from CQ2 to CQ3."

Other factors that led to this Overweight reiteration include the conversion to the bank deal and the mobile channel opportunity to drive local commerce. The acceleration of North American deals, new mobile features and merchant analytics, and turnaround in EMEA are other potential catalysts.

Groupon closed at 9.14 on Thursday and is currently trading +8.70 percent.