The short sellers withdraw their positions most from the Groupon Inc (NASDAQ:GRPN) and Zynga Inc (NASDAQ:ZNGA), among all the ‘social media players’. Both the companies saw the largest number of shorter interest between the April 30 and May 15 settlement dates.
In Groupon Inc (NASDAQ:GRPN), which is an e-commerce site, the short interest was withdrawn by about 21 percent in early May and stood at 34.58 million shares. This was the lowest figure since last June. The short selling of Groupon shares declined by around 8 percent of the float, and it took more than one day to cover the short sells.
Groupon Inc (NASDAQ:GRPN) recorded impressive results for the first quarter of 2013, and also a committee was formed to find a new CEO. The market capitalization of the company at present is $5 billion. It is estimated that the long term EPS growth of the company will be greater than 24 percent. The PEG ratio of the company is expected to be more than the industry average. The return on equity is expected to decline.
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The analysts has recommended that the shares should be held by investors for at least the past three months. The share price of the Groupon Inc (NASDAQ:GRPN) stock has outperformed the average price set by analysts. The performance of the stock price reveals that, at present, no upside price target can be set.
The stocks have surged more than 45 percent year to date. The Groupon stock has done better than eBay Inc (NASDAQ:EBAY) and Facebook Inc (NASDAQ:FB) and also other stocks in the past six months.
Zynga Inc (NASDAQ:ZNGA) is another stock where shorter withdraw their interest and retreated more than 33 percent to 22.20 million shares. For the game maker’s stock, this was the lowest number of shares, which were shorted since January. The number of shares that were sold short was 4 percent of the float.
Zynga Inc (NASDAQ:ZNGA) declared in May that it will rollover a learning games accelerator. In the middle of May, Jana Partners acquired a stake in the company. The market capitalization of Zynga stands at $2.7 billion. It is estimated that the long term EPS will be around 21 percent, but the return on equity will be low.
The analysts has recommended that investors should hold the stocks of Zynga. The average price target by the analysts is 12 percent more than the current share price. The target set by the analyst is below 52 weeks high, made almost a year ago.
The stock price of Zynga Inc (NASDAQ:ZNGA) has increased 42 percent year to date. The stock price had to go through a resistance at $3.50 level in the March. Zynga has outperformed Facebook in the past six months.
Analysts at TheStreet currently reiterated a “hold” rating for the game makers stock in a report issued on Tuesday. Overall, Zynga has a consensus rating of “Hold” with a price target of $3.74.