Cheap Stocks to Buy Now: Groupon (GRPN)
Market Cap: $5.6 billion
Industry: Internet Retail
Groupon (GRPN) has staged a pretty impressive turnaround in the past year. After bottoming under $3 in late 2012, embattled founder and CEO Andrew Mason quit and a cascade of structural changes and analyst upgrades resulted in the stock surging across 2013.
Lately, however, that turnaround has lost a bit of momentum as revenue beat expectations but guidance was disappointing at the end of February. However, the stock is still up more than 50% in the past 12 months even after a sharp sell-off on this news.
Look, the history of Groupon is not good. But the company appears to be soundly on the path to profitability and remains a pretty attractive acquisition target at the very least as big players like Google and Amazon (AMZN) enter the “daily deals” space.
Plus, investors that can look past some of the bad press to the tremendous potential of this online couponing stock could cash in big time in the years ahead. There’s no doubt that this kind of deals business remains in demand with consumers and will continue to be an important part of the advertising and marketing space going forward. And Groupon remains one of the biggest players in the space.
With a forward price-to-earnings of about 30, GRPN is still risky. But given its history and investor pessimism, you still have time to enter at a good price and ride the wave higher.