FARK.com: (6756789) Wall Street gives Groupon stock a 15% off coupon

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		Wall Street gives Groupon stock a 15% off coupon (gawker.com)		22
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1731 clicks; posted to Business » on 23 Nov 2011 at 11:47 AM | Favorite | share:

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22 Comments (+0 »)

Scarrio

2011-11-23 11:50:51 AM

15% down, 85% to go. Meh.

BizarreMan

2011-11-23 11:57:50 AM

I feel sorry for the people who are losing their assets on this dog. But all the signs were there.

When you have to restate financials because you've used questionable accounting rules that's a warning flag.

When Google walks away from a deal, that's a warning flag.

When you're not making money and don't know when you will and are running on cash reserves with only six months left in the bank, that's a warning flag.

When you take the money from venture capitalists and instead of holding it in reserve, give a massive payday to the big dogs, that's a warning flag.

LarryDan43

2011-11-23 12:11:52 PM

How long before the CEO blames naked short selling?

Ivo Shandor

2011-11-23 12:14:57 PM

Groupon, Inc. (GRPN)
Last Trade: 17.08
Market Cap: 10.88B

To pick a random example:
Seagate Technology PLC (STX)
Last Trade: 15.32
Market Cap: 6.43B

So Groupon, a flash-in-the-pan discount spa and cupcakes site, is worth $4.45 billion more than a company that designs, makes and sells actual products used (directly or indirectly) by a large fraction of the world's population. Right.

[Insert Futurama "I don't want to live on this planet any more" jpg]

Masso

2011-11-23 01:08:01 PM

Ivo Shandor: Groupon, Inc. (GRPN)
Last Trade: 17.08
Market Cap: 10.88B

To pick a random example:
Seagate Technology PLC (STX)
Last Trade: 15.32
Market Cap: 6.43B

So Groupon, a flash-in-the-pan discount spa and cupcakes site, is worth $4.45 billion more than a company that designs, makes and sells actual products used (directly or indirectly) by a large fraction of the world's population. Right.

[Insert Futurama "I don't want to live on this planet any more" jpg]

Still a long way to go down for Groupon then.

PowerSlacker

2011-11-23 01:25:57 PM

Short this pig all the way down to $1.

Debeo Summa Credo

2011-11-23 01:30:53 PM

LarryDan43: How long before the CEO blames naked short selling?

LOL. Good point.

BizarreMan: I feel sorry for the people who are losing their assets on this dog. But all the signs were there.

When you have to restate financials because you've used questionable accounting rules that's a warning flag.

When Google walks away from a deal, that's a warning flag.

When you're not making money and don't know when you will and are running on cash reserves with only six months left in the bank, that's a warning flag.

When you take the money from venture capitalists and instead of holding it in reserve, give a massive payday to the big dogs, that's a warning flag.

When FARK has a unanimous opinion on something involving the financial markets, and that unanimous opinion is that a stock is absolute garbage, that's a warning flag.

Famous Thamas

2011-11-23 01:51:04 PM

Debeo Summa Credo: LarryDan43: How long before the CEO blames naked short selling?

LOL. Good point.

BizarreMan: I feel sorry for the people who are losing their assets on this dog. But all the signs were there.

When you have to restate financials because you've used questionable accounting rules that's a warning flag.

When Google walks away from a deal, that's a warning flag.

When you're not making money and don't know when you will and are running on cash reserves with only six months left in the bank, that's a warning flag.

When you take the money from venture capitalists and instead of holding it in reserve, give a massive payday to the big dogs, that's a warning flag.

When FARK has a unanimous opinion on something involving the financial markets, and that unanimous opinion is that a stock is absolute garbage, that's a warning flag.

I agree, it doesn't take years of experience in the market to recognize that GroupOn wasn't a good idea.

Even though the stock is being pummeled, GroupOn's venture backers got their exit. I wouldn't be surprised if they were selling GroupOn as soon as they can to get what they can out of it.

Zoidfarb

2011-11-23 02:03:48 PM

"Seems legit to me"

jjorsett

2011-11-23 02:22:26 PM

Speculators. It's always the speculators. And the 1%. So it's the speculators and the 1%. AND Wall Street. So it's the speculators, the 1%, Wall Street, and corporations. The speculators, the 1%, Wall Street, and corporations. And capitalism. Speculators, the 1%, Wall Street, corporations, and capitalism ...

MrEricSir

2011-11-23 02:43:50 PM

If Groupon is worth billions, imagine how much the company that makes the coupon booklet you get in the mail every week is worth. You don't even have to pay for those coupons, it's gotta be worth at least twice what Groupon is worth.

cefm

2011-11-23 02:44:27 PM

Hint #1: Every financial analyst who mentioned it discussed how shocked they were at the rush of Groupon's primary stockholders (CEO, initial investors, officers) to sell off their preferred stock immediately after the IPO opened. Hardly a vote of confidence in future expectations.

Hint #2: No business has reported positive net results from using Groupon.

Hint #3: They make nothing, sell nothing, serve nobody, and don't seem to have any method of producing income other than investors.

Come to think of it why did anyone buy a single share of this stock?

platkat

2011-11-23 03:16:39 PM

cefm: Hint #1: Every financial analyst who mentioned it discussed how shocked they were at the rush of Groupon's primary stockholders (CEO, initial investors, officers) to sell off their preferred stock immediately after the IPO opened. Hardly a vote of confidence in future expectations.

Every? I saw positive reviews on Investor Guide Daily, but like any financial analyst (or outfit), you take it with a grain of salt.

Hint #2: No business has reported positive net results from using Groupon.

Businesses often sell their product or service at a loss when people use their groupons, however they are amenable to this because they consider it an advertising investment. They make money when these new customers come back because they liked the product/service they received last time. These are people who may not have tried it otherwise.

Hint #3: They make nothing, sell nothing, serve nobody, and don't seem to have any method of producing income other than investors.

Come to think of it why did anyone buy a single share of this stock?

They sell advertising (essentially) and they serve businesses and consumers. They make money because they take a 50% cut of the sale. I own a business, and I think that cost, plus the cost of the discount I'd be offering, is way too high. Some businesses really want to expand, and they will do this at their own expense. I don't own groupon stock, but I use groupons and have saved a lot of money eating at restaurants, shopping at stores, getting my hair done, etc. These are things I was going to do anyway, but groupon's deals persuaded me to do them at the businesses they advertised. So it's not really fair to say they serve no one.

Atomic Spunk

2011-11-23 03:46:22 PM

Carth

2011-11-23 04:35:05 PM

jjorsett: Speculators. It's always the speculators. And the 1%. So it's the speculators and the 1%. AND Wall Street. So it's the speculators, the 1%, Wall Street, and corporations. The speculators, the 1%, Wall Street, and corporations. And capitalism. Speculators, the 1%, Wall Street, corporations, and capitalism ...

[i44.tinypic.com image 360x254]

You say that like they is all different groups of people. One person can be a speculator who works on wall street and is in the 1%.

Murphyr

2011-11-23 05:02:32 PM

platkat: Businesses often sell their product or service at a loss when people use their groupons, however they are amenable to this because they consider it an advertising investment. They make money when these new customers come back because they liked the product/service they received last time. These are people who may not have tried it otherwise.

It's also useful for businesses that don't have much additional cost associated with additional customers, which is why spa treatments and yoga classes pop up so often. If the yoga class is being held anyway (and you're paying for the staff and space whether you fill the class or not), they'll want to sell any open spots even if they're getting a quarter of what they'd normally get for them.

That and the immediate deals (Groupon Now) usually aren't as good, but are severely limited, so that a business owner can try to boost how many people are coming into the business on a slow night without overwhelming the staff.

Groupon's still massively overvalued, but you're right in that it's not as though they've had no positive reports from businesses that issue Groupons.

hondamikesd

2011-11-23 05:38:45 PM

Terminal short. Groupon for Groupon shares (new window), 50% off!

relcec

2011-11-23 06:29:12 PM

BizarreMan: I feel sorry for the people who are losing their assets on this dog. But all the signs were there.

When you have to restate financials because you've used questionable accounting rules that's a warning flag.

When Google walks away from a deal, that's a warning flag.

When you're not making money and don't know when you will and are running on cash reserves with only six months left in the bank, that's a warning flag.

When you take the money from venture capitalists and instead of holding it in reserve, give a massive payday to the big dogs, that's a warning flag.

well apparently you shouldn't feel to bad, the cost to borrow gruopon shares to short them is close to the equivelant of a 100% apr.

Famous Thamas

2011-11-23 07:44:32 PM

Atomic Spunk: cefm: Hint #1: Every financial analyst who mentioned it discussed how shocked they were at the rush of Groupon's primary stockholders (CEO, initial investors, officers) to sell off their preferred stock immediately after the IPO opened. Hardly a vote of confidence in future expectations.

When a person owns stock prior to the IPO, they are usually subject to a 6 months lockout period which prohibits the sale of any of their stock until 6 months after IPO. Do you have a citation which mentions that these people were allowed to sell before the lockout ended? I'm holding stock in a company that's about to go public and I'd be curious to see how this kind of thing would be allowable.

Usually there is a lockout period for shares of common stock. They don't want everyone dumping all of the shares right away, the underwriters usually demand this as a part of their work.

Preferred Stock can be treated differently depending on the deal. If you own shares prior to IPO you should be told what you can and cannot do with them.

lohphat

2011-11-24 04:56:17 AM

Preferred stock is another tool of the 1% to keep the plebes in line and out of the club.

If you think the system is based upon merit, equity, and fairness, you're mistaken.

fat_free

2011-11-24 09:12:03 AM

Basically what's happening now is a game of "Pass the Opaque Flaming Bag of Poo".

The institutional investors have gotten out at 26, 23, whatever, and now those folks (un)lucky enough to be able to purchase this stock have looked inside of what they've purchased, seen that the stock itself is not worth as much as they originally thought going in, and now are passing the Opaque Flaming Bag of Poo to some other chump.

www.i-mockery.com

wutchamacallem

2011-11-24 10:42:49 AM

Carth: You say that like they is all different groups of people. One person ~~can be~~ are a speculator who works on wall street and is are in the 1%.

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