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Groupon (GRPN) Posts Q4 Earnings Surprise, Stock Up Big

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Online daily deals purveyor Groupon (GRPN - Free Report) delivered strong numbers in its Q4 earnings report after hours Thursday, bringing a narrower-than-expected bottom-line miss (accounting for, as Zacks does, stock-based employee compensation and other before non-recurring items [BNRI]) of -$0.02 per share. This amounts to a 150 percent positive surprise from the -$0.05 per share expected. Revenues were also vastly higher than expectations: $917 million came in as opposed to our consensus of $841 million.

It's turning into an auspicious debut reporting quarter for new Groupon CEO Rich Williams, who has overseen strong online sales and daily deals since he took the helm in late 2015. "...[W]e enter 2016 with a continued focus on streamlining our global operations..." said the former Amazon executive. To that end, Groupon has also affirmed its full-year 2016 guidance of $2.75 billion to $3.05 billion, and upped expected adjusted EBITDA of $80-130 million.

As a result of all this good news, Groupon shares popped big in late trading Thursday following the announcement. Currently up more than 13 percent after the bell, the company is closer to erasing the losses of a simply awful past week, which saw shares tumble more than 17 percent. Before the earnings announcement, GRPN was in the red to the tune of -27 percent just since the start of 2016.

Does this mean Groupon is finally in turnaround mode? Before the report today, Groupon was designated a Zacks Rank #2 (Buy) with a Momentum style score of B. Aside from the addition of Williams to the company's front office, they've also brought in a new Chief Product Officer (Jay Sullivan formerly of Mozilla) while bidding adieu to the company's Chief Technology Officer.

So at very least, Groupon is giving the appearance of shaking things up for the company. And by the looks of the after-market buying of Groupon stock, they just might be onto something.




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