Traders Buy Large Volume of Call Options on Groupon (NASDAQ:GRPN)

Key Points

• Unusually large options activity: Traders bought 19,108 call options on Groupon—an increase of 798% versus typical daily volume—while the stock jumped 6.5% to $15.92 on heavy volume (5.7M vs. avg 1.38M).
• Mixed analyst view and weak quarterly results: The consensus rating is "Hold" (target $33.67) but recent downgrades include Goldman Sachs cutting its target to $10 and Weiss reiterating a "sell"; Groupon also missed EPS and revenue estimates and remains unprofitable with negative ROE and net margin.
• High institutional ownership: About 90% of shares are held by institutions, with major funds like Vanguard, Bank of America and State Street recently increasing their positions.

Groupon, Inc. (NASDAQ:GRPN - Get Free Report) was the target of unusually large options trading activity on Tuesday. Traders acquired 19,108 call options on the company. This is an increase of 798% compared to the typical daily volume of 2,128 call options.

Wall Street Analyst Weigh In

Several analysts recently issued reports on the company. Weiss Ratings reiterated a "sell (d)" rating on shares of Groupon in a report on Monday, December 29th. The Goldman Sachs Group dropped their target price on Groupon from $17.00 to $10.00 and set a "sell" rating on the stock in a research report on Thursday, March 12th. Two analysts have rated the stock with a Buy rating, one has given a Hold rating and two have given a Sell rating to the stock. According to data from MarketBeat, the stock has a consensus rating of "Hold" and a consensus target price of $33.67.

Groupon Trading Up 6.5%

NASDAQ GRPN traded up $0.97 during trading on Tuesday, reaching $15.92. The company's stock had a trading volume of 5,699,107 shares, compared to its average volume of 1,382,155. The stock has a market capitalization of $617.66 million, a PE ratio of -7.49 and a beta of -0.04. The business has a 50-day moving average price of $11.99 and a 200-day moving average price of $15.72. Groupon has a 1-year low of $9.17 and a 1-year high of $43.08.

Groupon (NASDAQ:GRPN - Get Free Report) last posted its earnings results on Tuesday, March 10th. The coupon company reported $0.17 EPS for the quarter, missing the consensus estimate of $0.19 by ($0.02). The business had revenue of $132.71 million during the quarter, compared to the consensus estimate of $137.34 million. Groupon had a negative return on equity of 717.37% and a negative net margin of 16.76%. As a group, analysts expect that Groupon will post 0.28 earnings per share for the current year.

Hedge Funds Weigh In On Groupon

Several hedge funds have recently bought and sold shares of GRPN. Vanguard Group Inc. lifted its position in shares of Groupon by 22.2% in the third quarter. Vanguard Group Inc. now owns 2,108,578 shares of the coupon company's stock worth $49,235,000 after buying an additional 383,277 shares during the last quarter. Bank of America Corp DE increased its holdings in shares of Groupon by 552.5% during the 2nd quarter. Bank of America Corp DE now owns 1,136,524 shares of the coupon company's stock valued at $38,017,000 after acquiring an additional 962,337 shares during the last quarter. Tyro Capital Management LLC increased its holdings in shares of Groupon by 6.8% during the 3rd quarter. Tyro Capital Management LLC now owns 1,091,095 shares of the coupon company's stock valued at $25,477,000 after acquiring an additional 69,378 shares during the last quarter. Garnet Equity Capital Holdings Inc. raised its stake in shares of Groupon by 4.4% in the 4th quarter. Garnet Equity Capital Holdings Inc. now owns 958,660 shares of the coupon company's stock valued at $16,882,000 after acquiring an additional 40,000 shares in the last quarter. Finally, State Street Corp raised its stake in shares of Groupon by 25.8% in the 4th quarter. State Street Corp now owns 881,422 shares of the coupon company's stock valued at $15,522,000 after acquiring an additional 180,992 shares in the last quarter. 90.05% of the stock is owned by institutional investors and hedge funds.

Groupon Company Profile

Groupon, Inc operates an online marketplace that connects subscribers with local merchants offering discounted goods, services and experiences. Through its website and mobile applications, Groupon provides time-limited deals across categories such as restaurants, travel, beauty and wellness, home services, and consumer products. Merchants partner with Groupon to attract new customers and drive foot traffic, leveraging the platform's targeted marketing tools and large subscriber base to promote special offers and vouchers.

Founded in Chicago in 2008 by Andrew Mason, Eric Lefkofsky and Brad Keywell, Groupon pioneered the daily-deals model, quickly growing its user community and merchant network.

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