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Groupon Earnings Preview: In-Line Results Expected, US Booking Progress

Groupon Earnings Preview: In-Line Results Expected, US Booking Progress

Groupon (NASDAQ: GRPN) reports its 3Q13 earnings on Thursday, November 7 with a call at 2:00pm PT.

Consensus estimates show the average Q3 EPS estimate is 0.01, with Q3 prior estimate showing 0.03. The revenue estimate is expected at $616.13 million, with a $568.55 million prior revenue estimate.

Bloomberg reported an average analyst price target of $12. Analyst price target range from $8-$17 with Deutsche Bank, Stifel Nicolaus and Piper Jaffray taking a bullish stance.

In a note from Wednesday, October 30, Piper Jaffray analyst Gene Munster wrote that, "While there is debate as to how the September quarter will play out (some analysts expect a miss in Sep-13), we believe Sep-13 results (11/7 after the close), will represent the third consecutive quarter of modest improvements in fundamentals." Munster noted that a deal marketplace is a "viable long term business."

Ascendiant Capital Markets analyst Edward Woo is bearish on Groupon with an $8 price target and Sell rating. Woo forecasts that Q3 results will slightly miss estimates.

The analyst commented, "While the company has a plan to improve its international business (similar to what it did in the U.S.), we believe that there is still a long path to follow. We believe uncertainties with Groupon remain due to staff turnover, competition, and increased investments. In our view, the slowing growth and weak margins are likely to bolster continued skepticism as to Groupon's valuation, growth prospects, and profit potential."

Shares of Groupon have continued to decrease since the high of $12.76 in September. Early in October, shares took a drastic hit down 26 percent from its high of $12.76. The stock rebounded slightly before continuing its downward spike at the end of the month.

Groupon closed Wednesday at $10.02, down 2.48 percent from the open.


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