Reviewing Groupon (GRPN) & Its Peers

Groupon (NASDAQ:GRPN) is one of 142 publicly-traded companies in the “Broadline Retail” industry, but how does it weigh in compared to its competitors? We will compare Groupon to similar companies based on the strength of its valuation, earnings, risk, profitability, dividends, analyst recommendations and institutional ownership.

Profitability

This table compares Groupon and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Groupon	-25.26%	N/A	-20.28%
Groupon Competitors	-2.99%	-38.42%	-2.56%

Volatility and Risk

Groupon has a beta of 0.29, indicating that its share price is 71% less volatile than the S&P 500. Comparatively, Groupon’s competitors have a beta of 1.70, indicating that their average share price is 70% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Groupon and its competitors, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Groupon	2	0	1	0	1.67
Groupon Competitors	1405	5407	10882	310	2.56

Groupon presently has a consensus target price of $23.00, suggesting a potential upside of 47.63%. As a group, “Broadline Retail” companies have a potential upside of 17.84%. Given Groupon’s higher probable upside, equities research analysts plainly believe Groupon is more favorable than its competitors.

Earnings and Valuation

This table compares Groupon and its competitors gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Groupon	$497.41 million	-$83.52 million	-5.01
Groupon Competitors	$24.53 billion	$1.71 billion	15.07

Groupon’s competitors have higher revenue and earnings than Groupon. Groupon is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Institutional and Insider Ownership

90.1% of Groupon shares are held by institutional investors. Comparatively, 44.6% of shares of all “Broadline Retail” companies are held by institutional investors. 36.6% of Groupon shares are held by insiders. Comparatively, 23.6% of shares of all “Broadline Retail” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

Groupon competitors beat Groupon on 9 of the 13 factors compared.

About Groupon

Groupon, Inc., together with its subsidiaries, operates a marketplace that connects consumers to merchants. It operates in two segments, North America and International. The company sells goods or services on behalf of third-party merchants. It serves customers through its mobile applications and websites. The company was formerly known as ThePoint.com, Inc. and changed its name to Groupon, Inc. in October 2008. Groupon, Inc. was incorporated in 2008 and is headquartered in Chicago, Illinois.