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Mark Lennihan / AP
Employees and guests of Groupon celebrate the company's IPO at Nasdaq, Friday, Nov. 4, 2011 in New York. Groupon's shares slumped Wednesday, Nov. 23, to below their initial offering price on worries about competition in the online deals world.
Shares of Groupon Inc fell for a third day on Wednesday, sinking below the company's initial public offering price of $20 less than three weeks after the daily deal company went public.
Groupon's shares fell 14.8 percent to $17.11 on Nasdaq, bringing its decline over the last three days to about 34 percent.
Groupon raised more than $700 million in an IPO in early November, making it the biggest IPO by a U.S. Internet company since Google Inc raised $1.7 billion in 2004.
Analysts have cited concerns about increased competition. LivingSocial, Groupon's closest rival, which is part owned by Amazon.com Inc, announced plans on Monday to offer more than 20 deals with national merchants over the crucial Black Friday shopping period.
Daily deal companies often subsidize national deals, making them less profitable than offers run with local merchants. The national deals usually bring in lots of new customers, but put pressure on profit margins.
Copyright 2011 Thomson Reuters. Click for restrictions.
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Just another Wall Street heist. Make a website, generate enough eyeball traffic, issue an IPO - get rich off the hype - do stock-option buy/sell - then let the facebook lemmings stupid enough to buy into the internet stock long-term lose out while you sip another Pina Colada on Gold Beach.
What a turd. Those who bought groupon will never learn. Just like Pandora (who said they are not worried about making money) - they are gonna burn through that 700mil like a hot knife through warm butter. The bad press for them keeps on coming. The business that had to make 102,000 cupcakes and lost a ton of cash learned the hard way. This is not about customer loyalty, it's about get the best deal and on to the next sucker company that offers a discount. Businesses can't buy loyalty.
Whatever the reason these printable coupons or Printapons exist and it is valid to use them, although it can skew the marketing research for which they were intended.
If you didn't see this coming you were in the minority.
This was a smash and grab. I wonder how many in Congress got in at rock bottom and made a quick couple $100G?
you hit the nail on the head
The "shine" is coming off? What shine? Do you mean whatever misleading propaganda was used to get fools to buy the shares in the first place? Groupon doesn't even have a serious, logical plan to become profitable the way Amazon did.
Don't worry. IPO's are for special brokerage customers anyway, so Nancy Pelosi and gang got in and got out in the same day. They no doubt scored and tossed the rest to the vultures
Groupon is finished. I'd get the hell out of that stock immediately. It is not sustainable. There is no added value in their business plan. Dump your shares NOW! Basically, it is a domain with downloadable coupons. Sit tight kids as the shares plummet....just in time for the holidays, too! Ho Ho Ho!
It seems like the general consensus here is that Groupon is finished. Of course, this was no surprise to me, since I've been following this company's ups and downs for a while now. What do you think consumers will turn to for their daily deals? There's tons of businesses with a similar model. I think the best out of all of them is BigTip, though. They give a lot more freedom to merchants in terms of the discounts they give out. This, in turn allows merchants to continue giving more/better deals, as opposed to Groupon, whose deals kind of screwed small businesses over. I think BigTip is the way to go from here on out. Just my humble opinion though. Check it out yourselves. <a href="">BigTip</a>
Cheers.
Really? Why is this news? Who would be stupid enough to invest in a scheme like this? I will bet someone lost a lot of 401K money on this one.