Value
7.9/10data confidence 67%| Component | Sub-score |
|---|---|
| P/S | 8.9 |
| Fwd P/E | 8.7 |
| PEG | 10.0 |
| Analyst target | 3.0 |
- ▸Forward P/E: 12.8x
- ▸PEG: 0.07
- ▸Attractively valued
GRPN · Why this verdict
Why Groupon (GRPN) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.5/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Quality sits right at the engine's minimum floor, scoring exactly 4.0, driven by a lack of competitive moat and a failing Rule of 40 score of 16, triggering the quality-floor exit signal. Bear case | The quality score should rise durably above 4.5 over the next 12 months if margin and moat metrics genuinely improve. | →Stable |
| CounterA quality score landing exactly at the 4.0 floor, rather than meaningfully below it, suggests the business is on the borderline rather than clearly deteriorating, and a small improvement could move it comfortably above the threshold. | ||
The stock is overbought with an RSI near 85 while trading with a flat-to-negative 200-day moving-average slope, a combination the engine flags as late-cycle distribution risk. Momentum breakdown | RSI should cool back into a neutral 40-60 range over the next 12 months without a sharp price breakdown if the rally digests healthily. | →Stable |
| CounterOverbought readings can persist for extended periods during genuine uptrends, and rising on-balance volume suggests real accumulation rather than pure distribution. | ||
The setup has failed the engine's asymmetry gate with a ratio of -0.83, reflecting modeled downside of 15.0% against -12.5% modeled upside, an unfavorable risk/reward skew. Engine gate (failed) | The asymmetry ratio should turn positive above 1.5 over the next 12 months if the price target is revised higher or the stock pulls back to a better entry. | →Stable |
| CounterA negative asymmetry ratio driven by a stock already trading above its analyst target can resolve quickly through target upgrades following strong earnings, rather than requiring a price decline. | ||
Short interest is elevated at 56% of float, a level the engine flags as a key risk that could amplify volatility in either direction. Risk breakdown | Short interest should decline below 30% over the next 12 months if bearish positioning unwinds. | →Stable |
| CounterVery high short interest can set up a short squeeze that drives sharp upside moves, so elevated short interest is a double-edged signal rather than a purely bearish one. | ||
There has been no net insider buying or selling activity, $0 or 0.000% of market cap, leaving the engine's insider signal neutral with no directional conviction signal from company insiders. Insider breakdown | A clear directional insider signal, buying or selling exceeding 0.1% of market cap, should emerge over the next 12 months as insiders react to the stock's valuation. | →Stable |
| CounterThe absence of insider trading can simply reflect a blackout period around upcoming earnings rather than genuine insider indifference to the stock's prospects. | ||
Quality sits right at the engine's minimum floor, scoring exactly 4.0, driven by a lack of competitive moat and a failing Rule of 40 score of 16, triggering the quality-floor exit signal.
→StableBear case
- Expectation
- The quality score should rise durably above 4.5 over the next 12 months if margin and moat metrics genuinely improve.
CounterA quality score landing exactly at the 4.0 floor, rather than meaningfully below it, suggests the business is on the borderline rather than clearly deteriorating, and a small improvement could move it comfortably above the threshold.
The stock is overbought with an RSI near 85 while trading with a flat-to-negative 200-day moving-average slope, a combination the engine flags as late-cycle distribution risk.
→StableMomentum breakdown
- Expectation
- RSI should cool back into a neutral 40-60 range over the next 12 months without a sharp price breakdown if the rally digests healthily.
CounterOverbought readings can persist for extended periods during genuine uptrends, and rising on-balance volume suggests real accumulation rather than pure distribution.
The setup has failed the engine's asymmetry gate with a ratio of -0.83, reflecting modeled downside of 15.0% against -12.5% modeled upside, an unfavorable risk/reward skew.
→StableEngine gate (failed)
- Expectation
- The asymmetry ratio should turn positive above 1.5 over the next 12 months if the price target is revised higher or the stock pulls back to a better entry.
CounterA negative asymmetry ratio driven by a stock already trading above its analyst target can resolve quickly through target upgrades following strong earnings, rather than requiring a price decline.
Short interest is elevated at 56% of float, a level the engine flags as a key risk that could amplify volatility in either direction.
→StableRisk breakdown
- Expectation
- Short interest should decline below 30% over the next 12 months if bearish positioning unwinds.
CounterVery high short interest can set up a short squeeze that drives sharp upside moves, so elevated short interest is a double-edged signal rather than a purely bearish one.
There has been no net insider buying or selling activity, $0 or 0.000% of market cap, leaving the engine's insider signal neutral with no directional conviction signal from company insiders.
→StableInsider breakdown
- Expectation
- A clear directional insider signal, buying or selling exceeding 0.1% of market cap, should emerge over the next 12 months as insiders react to the stock's valuation.
CounterThe absence of insider trading can simply reflect a blackout period around upcoming earnings rather than genuine insider indifference to the stock's prospects.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Groupon's setup is deteriorating across several engine checks: quality sits right at the minimum floor, the technical setup shows late-cycle overbought distribution risk, the asymmetry gate has failed with a negative modeled risk/reward, and short interest remains elevated - together consistent with the recommendation to exit the position.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
4.0/10data confidence 100%| Component | Sub-score |
|---|---|
| ROA | 0.5 |
| Gross margin | 10.0 |
| Op margin | 0.0 |
| Net margin | 0.0 |
| Current ratio | 3.2 |
| FCF quality | 7.2 |
| Moat | 5.2 |
| Rule of 40 | 3.0 |
| Piotroski F | 6.7 |
- ▸FCF-positive despite GAAP loss (FCF margin 16%, FCF yield 8.0%)
- ▸No competitive moat
- ▸Rule of 40: 16 (fail)
Growth
6.2/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 2.5 |
| EPS growth | 10.0 |
Momentum
7.0/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.0 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 7.5 |
| Volume | 3.7 |
- ▸Overbought (RSI 79)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-MA but MA slope flat/negative + RSI 79 (late-cycle distribution risk)
Sentiment
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 5.5 |
| erm sentiment | 5.0 |
Insider
6.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 7.1 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
3.8/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 4.3 |
| quality rank | 0.9 |
| growth rank | 5.0 |
Technical
3.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.0 |
| support resistance | 2.0 |
| 52w position | 1.9 |
| gap | 6.0 |
Risk (lower is worse)
2.9/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 0.0 |
| days to cover | 3.2 |
| volatility | 0.0 |
| put call | 0.0 |
| implied vol | 0.0 |
| max pain risk | 7.0 |
| beta | 10.0 |
- ▸High short interest: 56%
- ▸Elevated put/call: 2.97
- ▸High IV: 105%
Catalyst
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
- ▸Earnings concerns: 2B/2M
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (6)
- MOMENTUM:7.0>=5.5
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:29d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- ASYMMETRY:-0.8=NEGATIVE
- 8K_SERIOUS:2.05
Warning (0)
none
Reward-to-Risk
-0.82
Upside
-12.3%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeInst Constrain — Small cap ($1.0B) below institutional reach
SuitabilitySpeculative — Drawdown -41% (>40% off 52w high)
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Value at 7.9 could not lift the engine output above the verdict floor. Failed gate signal: ASYMMETRY:-0.8=NEGATIVE.
The strongest dimensions are Value at 7.9, Momentum at 7.0, and Growth at 6.2; the weakest are Risk (lower is worse) at 2.9, Technical at 3.0, and Peer rank at 3.8. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of -0.82 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Quality At The Floor Threshold
Trip ifQuality score rises above 4.5, from the current 4.0, for 2 consecutive quarters.
- P2Late Cycle Overbought Momentum
Trip ifMomentum score stays above 5.5 for 2 consecutive quarters, showing no late-cycle reversal despite the overbought reading.
- P3Negative Asymmetry Gate Failure
Trip ifAsymmetry ratio rises above 1.5, from the current -0.83, as the price target is revised or downside estimate narrows.
- P4High Short Interest
Trip ifShort interest falls below 30% of float, from the current 56%.
- P5No Net Insider Activity
Trip ifNet insider transaction value exceeds $500,000 in either direction over a 90-day window, ending the current neutral signal.