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I Groupon the stock soaring falling about it than expected earnings report from -- what's in store for the stability site.
We are joined by senior research analyst at Sterne Agee.
Are the -- -- -- and hello again and then I'm curious we got to start out what their CEO.
The CEOs story Andrew Mason you know -- leaves.
Last quarter he was very colorful CEO I guess you can say that.
A deal like the suck more now that he's gone.
It's not so much about their liking it more or less you know since he's left I think the idea is that this company.
Already was on the right track I think -- last quarter.
Aware I think they were missing the mark was by the top line was drawing the bottom line now wasn't moving forward like people wanted.
I think what we're now seeing is you know they've got to international starting to look just a tad bit better still long way to go for these guys but -- I believe in the model I think they're adding value to merchants and and that consumers and fundamentally -- I think the model to work out over the coming years.
And this company -- operating.
At a sub optimal level.
From -- you know margin standpoint and that's the opportunity here in the next steps before yours -- you.
The mobile it was a couple -- things every first stop the stock is up over 40% the last six months and then some other analysts that in -- and on the -- and it's because.
-- -- race is gone hence my question do you about it but moving on overall.
Again Groupon really seems to be soaring up from a transaction perspective.
Also Smartphones anybody that uses that that the spending a heck of a lot more money than some -- using Groupon on their other desktop why is that.
I think guide Mobil for that is natural extension of their desktop business.
It's an important point because a lot of Internet companies are actually.
You know -- because of this shift.
I'll fly balls from desktop to mobile but people are are exhibiting that they're very comfortable.
You know doing transactions and although -- back to the group on business.
And in fact what you're seeing is people are spending 50% more of -- they're doing a mobile transaction vs a desktop transaction so.
For group on this has been quite seem less.
And I keep in mind that -- -- 45% is actually in North America in international you know markets it's actually lower.
It's -- growing faster but it.
-- that's another opportunity.
That would be a great -- coming group hasn't -- -- -- comedians right now I mean I would think that it is as the saturation.
Levels for Smartphones around the world -- even better -- -- -- actually got gonna really take off based on an anime -- price target of -- nine dollars on the stock right now so that must be.
-- Possibility that there's no doubt I think mobile is a very important part of -- pieces you know where.
We're thinking that you know mobile is going to be more than 50%.
You know before too long.
And and -- valuable to declare it or other international scale all right -- -- the international to take a little bit longer but but yeah I think god doesn't get there eventually you're right you know there in 48 different countries 500 different markets.
And people forget that this is a company that's only five years old and they've got five and a half billion dollars of merchant Billings.
They grew too fast they've got to unify all of the systems.
Once everything is flowing in there hitting on all cylinders.
This is gonna look like a different company in a few years.
Well I know what they've said the board is that it and that any in terms CEOs and hey we're not memory.
For new leadership I guess if you look at the stock prices probably okay that they're not.
And a big -- right now but there's been a lot of speculation about a deal with Google with them a six billion dollar type of -- partnership something like that between Groupon and Google what do you think.
You know it's an -- speculation.
That started before this company went public -- -- it does Google.
Was reportedly interest in buying this company for six billion dollars yeah yeah of the current valuation of this company is you know -- -- -- half that so.
Clearly Google saw something there and what's different is this company is now profitable -- back then.
It was unclear they would be profitable they're generating free cash flow it wasn't clear back then they've got one point two billion dollars in their balance -- so.
If anything I would argue that they have a much more dominant position -- stronger balance sheet.
And a bigger business -- should be more value both now.
Revenues up 8% I mean for this company for Groupon and again you know they got such.
A media ahead in improper a lot of buzz but they got so much.
They got a tough time -- would -- Mason was other kind of make -- random strange financial projections and a lot of you -- -- around the IPO at the time and it just in general is surviving -- and so -- -- story and we shall see carbon Bhatia senior research analyst at AG art and thank -- is consider them.
Thank -- general.
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