NEW YORK (AP) ? Groupon's stock is trading at its lowest levels since going public late last year, and on Monday the online deals site will get a chance to show investors that its shares are a bargain, when it reports second-quarter earnings after the closing bell.
WHAT TO WATCH FOR: Groupon makes money by taking a cut from the online deals it offers to subscribers on everything from restaurant meals to Botox treatments and weekend getaways.
Though Groupon is the largest company of its kind, it is still young and its business is still relatively unproven, so investors will look for signs of long-term stability and growth prospects.
The biggest concern for Sterne Agee analyst Arvind Bhatia, who downgraded Groupon on Wednesday, is slowing growth. He thinks Groupon has seen "soft" billing trends in recent months because of the weak economy in Europe and market share gains by smaller rival LivingSocial.
Bhatia cut his rating on Groupon from "Buy" to "Neutral."
WHY IT MATTERS: Groupon is the largest and only publicly traded daily-deals site out there. As a pioneer, its earnings are an important gauge of how this new industry is faring. Investors don't seem too confident ? Groupon's stock has lost more than half of its value since it went public at $20 per share last November amid worries about its business model. The shares have lost two-thirds of their value since the start of the year.
WHAT'S EXPECTED: Analysts, on average, expect earnings of 3 cents per share on revenue of $573 million, according to a poll by FactSet.
In May, Groupon forecast revenue of between $550 million and $590 million.
Source: http://news.yahoo.com/earnings-preview-groupon-report-2q-results-164244124--finance.html
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