Groupon witnessed a significant drop in short interest during the month of March. As of 13th March, short interest in the daily deal firm totaled 68,986,170 shares, a drop of 5.9% from February 27th total of 73,300,555. Around 14.6% of the company’s stock is currently sold short.
Repeat buyers a plus for Groupon
Last week, Wunderlich Securities assigned a Buy rating to Groupon, stating that a large number of loyal customers are repeatedly visiting the site. Analyst Blake Harper also increased his price target to $10 from $6.
On the basis of a survey, Harper noted that around 78% of the respondents who purchased from Groupon over the couple of months said that they would visit the site and make purchases again within three months.
Harper’s sample involved 307 U.S. adults who purchased from Groupon within past year. Among the respondents, there were 192 women and 115 men from the United States, with 306 of them between ages of 18-64 and one above 64 years of age. He noted that that a larger number of customers now think of Groupon as more than simply a daily email offer company.
Groupon a Buy
In recent weeks, many research firms have come out with their ratings on Groupon. In a research note last week, the analysts at Vetr upgraded the stock from a Hold rating to a Buy, with a price target of $8.71. Wunderlich analysts, in a research note on March 25, raised their rating on Groupon from Hold to a Buy, and increased the price target from $6.00 to $10.00. TheStreet analysts upgraded the company from Sell to a Hold, in a research note on March 19th. Deutsche Bank reiterated a Buy with a price target of $8.50, in a research note on March 18th. Presently, Groupon has a consensus rating of Buy and a consensus price target of $9.03.
In separate news, Groupon director Theodore Leonsis sold 19,750 shares of the company’s stock in a transaction dated March 16th. The shares were sold at an average price of $7.78, totaling to $153,655, according to a filing with the SEC.
In pre-market trading today, Groupon shares were up 0.13% to $7.62, while year to date, the stock is down over 7%.