Groupon Analyst Roundup After Investor Day Presentation

Groupon Inc GRPN hosted an analyst and investor day Tuesday.

The market responded positively to Groupon’s goals with the stock trading at $8.14 Wednesday, up 4.43 percent.

Below are comments from analysts along with current ratings and price targets.

Deutsche Bank - Buy, $8 price target

“Internet marketplaces are hard to build, but once the supply/demand flywheel kicks in the growth starts to take care of itself - witnessed repeatedly in history by Amazon, Alibaba, and more recently with mobile-first companies like Uber and Airbnb. Many have argued that Groupon isn’t exactly a “marketplace” and doesn’t deserve to be in the same conversation because of its tumultuous past and low growth rates, but we look at it differently, with the history better explained by their poor original choice in distribution (email vs. PC/mobile, push vs. pull), which is for the most part behind Groupon in late 2014.”

UBS - Neutral, $8.50 price target

“Groupon laid out an impressive plan for a combination of above global eCommerce growth and stable/increasing margins as its business transitions from its push e-mail past to a global integrated advertising/commerce platform. In addition to executing on the analyst day plan, Groupon continues to see potential for strategic alternatives in Asia as a means of driving shareholder value. Given Groupon's stock has underperformed the SPX (by 44 percent ytd), a path of meeting/beating expectations could see the stock reverse that performance.”

Bank of America - Neutral, $8 price target

“Mobile remains a big opportunity as N.A. mobile customers generate >$70 of additional gross billings annually vs. web only customers, and Int'l mobile penetration is 35 percent lower than N.A. Product investments are focused on mobile, and GRPN indicated product innovation will accelerate in '15 so we expect mobile innovation coupled with improved conversion rates to drive local billings growth.”

Wunderlich - Hold, $6 price target

“Gross margins in North America are projected to expand to over 15 percent by 2017 while EMEA has already reached a ceiling level at 17 percent. The company has hired ecommerce veterans and has been implementing many industry standard best practices to improve efficiency, but we are still not sold on how they can compete profitably against against larger ecommerce companies or expect investors to give that business a reasonable valuation multiple in the near term.”

Goldman Sachs - Neutral, $8 price target

“Potential for sustainable local growth and gross margin expansion with GRPN’s 150m monthly visitors and 800k merchants...a significant advantage in addressing local advertising market.”