JPMorgan Chase & Co. (NYSE:JPM) believes that Groupon Inc (NASDAQ:GRPN) is recovering nicely from a name that has grown tarnished by the overuse of email in describing the company’s deals and the fact that Groupon has suffered a touch based on companies’ unwillingness to honor a deal on occasion. As a result, Groupon has endeavored to look towards a pull versus a push commerce model, and has looked to improved its traction in North America by focusing more on its mobile revenue and applications.
Additionally, Groupon Inc (NASDAQ:GRPN) is turning around its international revenue streams. JPMorgan Chase & Co. (NYSE:JPM) and others believe that Groupon will report revenue of $606 million for the quarter, largely in line with the consensus estimate and on the high side of Groupon’s guidance of $575-$625 million. Groupon is expected to show earnings of $0.02 for the quarter which represents a considerable fall in earnings from the year-over-year quarter when earnings were $0.08 per share.
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Mobile is improving Groupon customer growth
The importance of mobile to Groupon Inc (NASDAQ:GRPN) is massive, and this pull vs. push model is now responsible for 45 percent of the company’s North American transactions. Over 40 million people have downloaded Groupon’s mobile apps on either Android or iOS devices. Even more encouraging about this is the fact that in the Q1 alone, Groupon saw seven million downloads of its mobile apps.
About 52% of Groupon’s billings come from international markets and Groupon Inc (NASDAQ:GRPN) hopes that it sees an improvement in this area. For year-over-year Q1, international billings were down nearly 10%. Groupon is hoping to report a gain in active customer growth and will be looking to improve its Smart Deals billings in international markets.
Groupon can be an unpredictable stock
JPMorgan Chase & Co. (NYSE:JPM) is largely in line with the consensus estimate for fiscal year revenue. Groupon is expected to show sales of $2.53 billion up 9.4% from sales of 2.33 billion in fiscal 2012.
For the fiscal year, the consensus is calling for earnings of $0.17 per share versus $0.13 per share the year prior.
Groupon Inc (NASDAQ:GRPN) is often a strange trading stock following its earnings call. In the corresponding quarter last year Groupon came in $0.02 ahead of the consensus number, yet following that report the stock realized a 21.7 percent loss in five trading days.
Last quarter the company reported earnings in line with the consensus estimate. Following that report the stock realized a 20.3 percent gain in thirty trading days. Overall historical data indicates the company to be (on average) an ‘opposite’ price reactor when the company reports earnings.