Groupon Shares Sink To All Time Lows On Revenue Accounting Concern

Groupon GRPN slid to at all-time low on Thursday after analyst Ken Sena at Evercore downgraded the stock, citing transparency and disclosure concerns. Sena cut his target on the stock to $9, from $17 previously, and detailed specific concerns about the quality of the company's first-quarter earnings beat. On its conference call, Groupon reported 32% revenue growth from the year-ago quarter, driven partly by better targeting of deal offers to consumers. Sena wrote to clients, however, that more than half the revenue growth was driven by the company's Groupon Goods business, where some sales are booked in gross, instead of the portion of the coupon deal kept by the company. In a recent quarterly SEC filing, Sena contends that Groupon appears to have contradicted what it said on its conference call about what drove the growth: He wrote that the accounting appears to have played a strong role. Henry Blodget, former Wall Street analyst wrote that Sena's note, “basically accuses the company of fraud.” Sena was not immediately available for comment. A request for comment from Groupon was not immediately returned. The company is expected to report earnings on or around August 13. Groupon GRPN shares fell 9% to $6.96 in afternoon trading Thursday, as other social media stocks fell ahead of Facebook's earnings expected after the market close. Facebook FBshares slid 7 to $27.26. Linked Corp. LNKD fell about 1% to $100.61.