Groupon Inc (NASDAQ:GRPN) released rather solid earnings on Tuesday, but today, shares are down by nearly 20%. So what’s going on with the daily deal giant’s stock? It may be that the company’s guidance was very week, and it doesn’t help that multiple analysts have slashed their price targets. Jefferies analysts cut their target from $9.50 to $8 this morning. In a report dated May 7, 2014, Evercore analysts also cut their price target—from $8 to $6.50 a share.

Groupon Inc GRPN

Groupon’s results were mixed

Analysts Ken Sena, Conor McDade and Andrew McNellis say Groupon Inc (NASDAQ:GRPN)’s results were just too mixed. The company posted $1.8 billion in billings, which was 12% higher than their estimate because of higher contributions from Ticket Monster. However, Groupon’s revenues were in line at $758 million because of Ticket Monster’s “low teens take-rate.”

Overall take-rate was 41.7%, compared to their 47.1% estimate. EBITDA was 6% lower than their estimate, coming in at $40 million and 5% of revenue. The company guided for second quarter revenue of $55 million in EBITDA at the midpoint of its range. That guidance was 28% lower than their estimate, even though they noted that Groupon Inc (NASDAQ:GRPN) had increased the number of marketing emails it has sent this quarter.

Groupon raises fiscal year guidance

Groupon Inc (NASDAQ:GRPN) raised its fiscal year guidance because it expects its Local business to reaccelerate and to see higher margins in Goods. The full-year EBITDA guidance moved from more than $285 million up to more than $300 million.

The Evercore analysts noted growth in Groupon Inc (NASDAQ:GRPN)’s Goods segment but question whether that growth is enough to warrant the company’s increased fiscal year guidance. They say Groupon’s billings grew 8% year over year without Ticket Monster, compared to the previous quarter’s 5% growth. Most of the acceleration came from Goods. When looking at Groupon’s core Local business in North America, Europe, the Middle East and Africa, there’s just 1% growth. Gross profit margin also missed expectations, coming in at 51% rather than the 57% they were expecting.

Groupon estimates reduced

The Evercore team cut their second quarter EBITDA to $65 million, which is still at the high end of Groupon Inc (NASDAQ:GRPN)’s guidance. This reduces their price target from $8 to $6.50 per share, implying a multiple of 11 times 2015 EBITDA estimate. They see a risk to Groupon’s fiscal year guidance, particularly if its efforts to reaccelerate its Local business and improve margins in its Goods segment don’t pan out.

They maintained their Equal-Weight rating on Groupon Inc (NASDAQ:GRPN).

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