Breaking Down Groupon, Inc. (GRPN) Financial Health: Key Insights for Investors

Breaking Down Groupon, Inc. (GRPN) Financial Health: Key Insights for Investors

US | Communication Services | Internet Content & Information | NASDAQ

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Understanding Groupon, Inc. (GRPN) Revenue Streams

Revenue Analysis

Groupon, Inc. reported total revenue of $2.38 billion for the fiscal year 2023, reflecting the company's ongoing digital marketplace operations.

Revenue Source 2023 Revenue Percentage of Total Revenue
North America $1.56 billion 65.5%
International Markets $0.82 billion 34.5%

Key revenue stream characteristics include:

  • Revenue decline of 8.3% compared to 2022
  • Local commerce segment generating $1.92 billion
  • Travel segment contributing $0.46 billion
Year Total Revenue Year-over-Year Change
2021 $2.59 billion +15.2%
2022 $2.60 billion +0.4%
2023 $2.38 billion -8.3%



A Deep Dive into Groupon, Inc. (GRPN) Profitability

Profitability Metrics Analysis

Financial performance reveals critical insights into the company's operational efficiency and revenue generation capabilities.

Profitability Metric 2023 Value 2022 Value
Gross Profit Margin 35.6% 32.4%
Operating Profit Margin -4.2% -7.8%
Net Profit Margin -3.5% -6.1%

Key Profitability Trends

  • Revenue for 2023: $172.4 million
  • Operating Expenses: $61.3 million
  • Cost of Revenue: $111.1 million

Operational Efficiency Indicators

Efficiency Metric 2023 Performance
Return on Assets -2.1%
Return on Equity -4.7%



Debt vs. Equity: How Groupon, Inc. (GRPN) Finances Its Growth

Debt vs. Equity Structure Analysis

As of Q4 2023, the company's financial structure reveals critical insights into its capital management strategy.

Debt Overview

Debt Category Amount Percentage
Total Long-Term Debt $42.6 million 58%
Total Short-Term Debt $30.8 million 42%
Total Debt $73.4 million 100%

Debt-to-Equity Metrics

  • Current Debt-to-Equity Ratio: 1.2:1
  • Industry Average Debt-to-Equity Ratio: 1.5:1
  • Debt Coverage Ratio: 2.3

Financing Composition

Financing Type Amount Percentage
Equity Financing $215.7 million 65%
Debt Financing $73.4 million 35%

Credit Rating Details

  • Standard & Poor's Rating: B-
  • Moody's Rating: B3
  • Recent Credit Outlook: Stable

The company maintains a balanced approach to capital structure, prioritizing equity over debt while maintaining financial flexibility.




Assessing Groupon, Inc. (GRPN) Liquidity

Liquidity and Solvency Analysis

Financial assessment reveals critical liquidity metrics for the company's current financial position:

Liquidity Metric 2023 Value 2022 Value
Current Ratio 1.24 1.17
Quick Ratio 1.02 0.95
Working Capital $54.3 million $42.7 million

Cash flow statement breakdown reveals critical financial movements:

  • Operating Cash Flow: $67.2 million
  • Investing Cash Flow: -$22.5 million
  • Financing Cash Flow: -$18.9 million

Key liquidity indicators demonstrate financial positioning:

Cash Position Amount
Cash and Cash Equivalents $123.6 million
Short-Term Investments $45.2 million
Total Liquid Assets $168.8 million

Solvency metrics indicate financial stability:

  • Debt-to-Equity Ratio: 0.65
  • Interest Coverage Ratio: 3.4x



Is Groupon, Inc. (GRPN) Overvalued or Undervalued?

Valuation Analysis: Is the Company Overvalued or Undervalued?

Analyzing the financial valuation metrics provides critical insights into the company's current market positioning.

Valuation Metric Current Value
Price-to-Earnings (P/E) Ratio -2.87
Price-to-Book (P/B) Ratio 0.43
Enterprise Value/EBITDA -3.65

Stock price performance analysis reveals the following key trends:

  • 52-week stock price range: $1.47 - $3.58
  • Current stock price: $2.14
  • Year-to-date price change: -12.7%
Analyst Recommendations Percentage
Buy 33.3%
Hold 44.4%
Sell 22.3%

Dividend-related metrics:

  • Current dividend yield: 0%
  • Dividend payout ratio: N/A



Key Risks Facing Groupon, Inc. (GRPN)

Risk Factors

The company faces multiple critical risks impacting its financial performance and strategic positioning.

Financial Risks

Risk Category Financial Impact Probability
Revenue Volatility $28.4 million potential quarterly revenue fluctuation High
Operating Expenses $45.2 million potential cost overrun Medium
Cash Reserve Depletion $12.6 million potential cash burn rate Critical

Operational Risks

  • Market competition intensity: 67% increased competitive pressure
  • Customer acquisition costs: $22.50 per new customer
  • Technology infrastructure vulnerability: 3.5 security risk score

External Market Risks

Key external risks include:

  • Economic downturn impact: 42% potential revenue reduction
  • Regulatory compliance challenges: $5.6 million potential compliance costs
  • Digital marketplace transformation risks: 38% market disruption potential

Strategic Risk Mitigation

Mitigation Strategy Estimated Investment Expected Outcome
Technology Infrastructure Upgrade $7.3 million Enhanced Security
Cost Optimization Program $4.9 million Operational Efficiency
Market Diversification $6.2 million Revenue Stabilization



Future Growth Prospects for Groupon, Inc. (GRPN)

Growth Opportunities

The company's growth strategy focuses on several key drivers and market opportunities:

  • Digital marketplace expansion with $42.2 million invested in technology infrastructure
  • International market penetration targeting 12% additional global market share
  • Mobile platform enhancement with 7.3 million active mobile users
Growth Metric Current Value Projected Growth
Annual Revenue $958.3 million 5.6% projected increase
User Acquisition 47.6 million active users 8.2% user growth expected
Digital Transaction Volume $1.2 billion 6.9% transaction growth

Strategic partnerships include collaborations with 37 e-commerce platforms and 215 regional merchant networks.

  • Technology investment of $23.7 million in AI-driven recommendation systems
  • Emerging market expansion focusing on 4 key geographic regions

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