What To Watch For In Groupon’s Q4 Earnings

Groupon’s (NASDAQ:GRPN) is scheduled to report its Q4 earnings on February 13. The company has been struggling to transition its business model from that of a coupon company to a full-fledged marketplace. We will be listening in for updates on the progress of the transition and the plans for the next year.

We are a price estimate of $4 per share for Groupon, which is around the current market price. Our interactive dashboard on Groupon’s Price Estimate outlines our forecasts and estimates for the company. You can modify any of the key drivers to visualize the impact of changes on its valuation.

The key aspect to be watched will be what steps Groupon takes to reduce friction between higher-margin, lower-volume coupon customers to lower-margin, higher-volume marketplace customers. Not only does the company face a challenge of brand perception (of being a discount coupon provider trying to shed the image of a discount business and entering into a marketplace) but also has to manage the inertia in customer expectations. Coupled with fact that Amazon is increasingly becoming the de-facto choice for online retail, Groupon faces somewhat of an uphill task.

Also of interest will be management commentary around the expected traction with the distribution partnership with AMC and on the appointment of Melissa Thomas as Chief Accounting Officer and Treasurer following the departure of Brian Stevens.

Do not agree with our forecast? Create your own price forecast for the Groupon by changing the base inputs (blue dots) on our interactive dashboard.