Groupon (GRPN) Surges 7.6%: Is This an Indication of Further Gains?
Groupon GRPN shares rallied 7.6% in the last trading session to close at $7.38. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 61% gain over the past four weeks.
Groupon is taking initiatives to improve customer engagement and retention by orienting its marketplace to serve everyday customer problems instead of just focusing on discounts. This involves monitoring prices as well as the removal of high refunding merchants. Groupon is also looking to save costs annually by lowering tech costs through automation.
This online daily deal service is expected to post quarterly loss of $0.34 per share in its upcoming report, which represents no change from the year-ago quarter. Revenues are expected to be $121.25 million, down 20.9% from the year-ago quarter.
Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.
For Groupon, the consensus EPS estimate for the quarter has been revised 19.1% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on GRPN going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Groupon is part of the Zacks Internet - Commerce industry. BigCommerce BIGC, another stock in the same industry, closed the last trading session 0.6% lower at $10.41. BIGC has returned 13.3% in the past month.
For BigCommerce , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.09. This represents a change of +52.6% from what the company reported a year ago. BigCommerce currently has a Zacks Rank of #3 (Hold).
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