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Groupon (GRPN) Up 71.8% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Groupon (GRPN - Free Report) . Shares have added about 71.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Groupon due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Groupon Q1 Loss Beat Estimates, Revenues Down Y/Y
Groupon reported a non-GAAP loss of 65 cents per share in first-quarter 2023, narrower than the Zacks Consensus Estimate of a loss of 81 cents. The company reported non-GAAP loss of 80 cents per share in the year-ago quarter.
Revenues of $121.6 million missed the Zacks Consensus Estimate by 9.15%. The figure declined 21% on a year-over-year basis (down 19% excluding the foreign exchange effect).
Region-wise, North America revenues slumped 19% year over year to $89.3 million. International revenues fell 25% (down 21%, excluding the foreign exchange effect) to $32.4 million.
Quarterly Details
Local revenues of $106.6 million declined 18% year over year (down 17%, excluding the foreign exchange effect). North America Local revenues declined 16%, while International Local revenues fell 24% year over year.
Consolidated Travel revenues fell 30.8% year over year to $5.7 million. North America Travel revenues declined 43.1% year over year. International Travel revenues declined 12% in the reported quarter.
On a consolidated basis, Goods revenues declined 38.2% year over year to $9.3 million. North America Goods revenues declined 38.9%, while International Goods revenues fell 37.4%, excluding the foreign exchange effect, on a year-over-year basis.
Customer Metrics
At the end of the first quarter, Groupon had approximately 18.2 million active customers compared with 22.2 million at the end of the previous year’s quarter.
At the end of the first quarter, the company had approximately 10.9 million active customers based in North America and 7.3 million active international customers.
Operating Details
In the first quarter, gross profit came in at $104.7 million, down 21.9% year over year.
Selling, general and administrative expenses fell 19.6% year over year to $101.6 million in the reported quarter. Marketing expenses declined 37% to $24.8 million.
The company reported GAAP operating loss of $30.6 million compared with a loss of $32.1 million in the year-ago quarter.
Balance Sheet & Cash Flow
Groupon exited the quarter with cash and cash equivalents of $163.8 million, down from $281 million as of Dec 31, 2022.
In the first quarter, the company generated $76.3 million in operating cash outflow against the operating cash flow of $15.9 million generated in the prior quarter.
Groupon reported a free cash outflow of $85.9 million against $10.2 million of free cash flow reported in the previous quarter.
Guidance
For the second quarter of 2023, Groupon expects its second-quarter revenues to decline year over year at a similar rate as observed in the first quarter. It anticipates to generate a positive adjusted EBITDA in the current quarter.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
The consensus estimate has shifted 17.33% due to these changes.
VGM Scores
At this time, Groupon has an average Growth Score of C, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. It comes with little surprise Groupon has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Groupon is part of the Zacks Internet - Commerce industry. Over the past month, Amazon (AMZN - Free Report) , a stock from the same industry, has gained 10.8%. The company reported its results for the quarter ended March 2023 more than a month ago.
Amazon reported revenues of $127.36 billion in the last reported quarter, representing a year-over-year change of +9.4%. EPS of $0.31 for the same period compares with $0.21 a year ago.
Amazon is expected to post earnings of $0.34 per share for the current quarter, representing a year-over-year change of +240%. Over the last 30 days, the Zacks Consensus Estimate has changed +1.4%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Amazon. Also, the stock has a VGM Score of A.
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Groupon (GRPN) Up 71.8% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Groupon (GRPN - Free Report) . Shares have added about 71.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Groupon due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Groupon Q1 Loss Beat Estimates, Revenues Down Y/Y
Groupon reported a non-GAAP loss of 65 cents per share in first-quarter 2023, narrower than the Zacks Consensus Estimate of a loss of 81 cents. The company reported non-GAAP loss of 80 cents per share in the year-ago quarter.
Revenues of $121.6 million missed the Zacks Consensus Estimate by 9.15%. The figure declined 21% on a year-over-year basis (down 19% excluding the foreign exchange effect).
Region-wise, North America revenues slumped 19% year over year to $89.3 million. International revenues fell 25% (down 21%, excluding the foreign exchange effect) to $32.4 million.
Quarterly Details
Local revenues of $106.6 million declined 18% year over year (down 17%, excluding the foreign exchange effect). North America Local revenues declined 16%, while International Local revenues fell 24% year over year.
Consolidated Travel revenues fell 30.8% year over year to $5.7 million. North America Travel revenues declined 43.1% year over year. International Travel revenues declined 12% in the reported quarter.
On a consolidated basis, Goods revenues declined 38.2% year over year to $9.3 million. North America Goods revenues declined 38.9%, while International Goods revenues fell 37.4%, excluding the foreign exchange effect, on a year-over-year basis.
Customer Metrics
At the end of the first quarter, Groupon had approximately 18.2 million active customers compared with 22.2 million at the end of the previous year’s quarter.
At the end of the first quarter, the company had approximately 10.9 million active customers based in North America and 7.3 million active international customers.
Operating Details
In the first quarter, gross profit came in at $104.7 million, down 21.9% year over year.
Selling, general and administrative expenses fell 19.6% year over year to $101.6 million in the reported quarter. Marketing expenses declined 37% to $24.8 million.
The company reported GAAP operating loss of $30.6 million compared with a loss of $32.1 million in the year-ago quarter.
Balance Sheet & Cash Flow
Groupon exited the quarter with cash and cash equivalents of $163.8 million, down from $281 million as of Dec 31, 2022.
In the first quarter, the company generated $76.3 million in operating cash outflow against the operating cash flow of $15.9 million generated in the prior quarter.
Groupon reported a free cash outflow of $85.9 million against $10.2 million of free cash flow reported in the previous quarter.
Guidance
For the second quarter of 2023, Groupon expects its second-quarter revenues to decline year over year at a similar rate as observed in the first quarter. It anticipates to generate a positive adjusted EBITDA in the current quarter.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
The consensus estimate has shifted 17.33% due to these changes.
VGM Scores
At this time, Groupon has an average Growth Score of C, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. It comes with little surprise Groupon has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Groupon is part of the Zacks Internet - Commerce industry. Over the past month, Amazon (AMZN - Free Report) , a stock from the same industry, has gained 10.8%. The company reported its results for the quarter ended March 2023 more than a month ago.
Amazon reported revenues of $127.36 billion in the last reported quarter, representing a year-over-year change of +9.4%. EPS of $0.31 for the same period compares with $0.21 a year ago.
Amazon is expected to post earnings of $0.34 per share for the current quarter, representing a year-over-year change of +240%. Over the last 30 days, the Zacks Consensus Estimate has changed +1.4%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Amazon. Also, the stock has a VGM Score of A.