Are Groupon's Days Numbered?

Finance expert Mike Periu on what may be the beginning of the end for Groupon.
President, Proximo, LLC
November 13, 2012

Groupon's stock price hit a new low yesterday of $2.69 per share, down 87 percent since its debut as a publicly-traded company. Investors have been selling the stock because of several key problems, which many believe are not fixable. Groupon continues to lose money consistently, raising doubts about the company's ability to turn a profit. More worrisome though is the company's declining sales growth and difficultly in turning small businesses into repeat customers.

These signals indicate that Groupon may have just been a fad instead of a game changing-marketing channel for small businesses. The company still has more than $1 billion in cash on hand, equivalent to about $2 per share, meaning that investors are valuing the business at only $0.69 per share. If the company is to survive, it will need to find a path towards profitable growth very quickly or be acquired. 

Learn more at the Chicago Sun-Times.

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