GRPN (Groupon Inc) Technical Analysis - January 2025
Technical Overview:
Current Price: $10.56 (+2.03%)
Key Levels:
- Support: Around $10.00 (psychological support)
- Resistance: $11.00 (short-term), $13.00 (major resistance)
- 52-Week Range: $7.75 - $19.56
Moving Averages:
- 20-day SMA: Downward sloping at -8.80% (acting as short-term resistance)
- 50-day SMA: -2.62%, indicating weak momentum
- 200-day SMA: -14.56%, suggesting a long-term downtrend
Indicators:
- RSI (14): 41.86 (near oversold, showing weak momentum)
- MACD: Bearish crossover, signaling downward momentum
- ATR (14): 0.69 (moderate volatility)
- Volume: 789K (below average volume of 1.40M, indicating lower interest)
Fundamental Overview:
- Market Cap: $419.95M
- Income: $19.32M (positive net income)
- Sales: $499.89M (P/S ratio of 0.84, fair valuation)
- Book Value per Share: $1.01 (trading significantly above book value)
- Cash per Share: $4.73 (strong cash position)
- Debt/Equity: 5.82 (high leverage, potential risk)
- Quick Ratio: 0.93, Current Ratio: 0.93 (liquidity concerns)
Profitability Metrics:
- ROA: 3.61%
- ROE: -472.72% (due to high leverage)
- Profit Margin: 3.87%
- Gross Margin: 89.70% (healthy profitability at gross level)
Growth Metrics:
- Sales Growth (Y/Y): 114.25%
- EPS Growth (Y/Y): 47.44%
- EPS Growth (Next Y): 140.24% (strong expected earnings growth)
Insider & Institutional Holdings:
- Insider Ownership: 46.41% (strong insider confidence)
- Institutional Ownership: 49.61% (institutional support with recent increase of +27.65%)
Short Interest:
- 37.49% Short Float (high short interest, potential squeeze)
- Short Ratio: 5.69 (significant bearish sentiment)
Bias:
Neutral to bearish
- The stock is struggling to maintain above key moving averages, indicating weak momentum.
- High short interest suggests potential for a short squeeze, but the technicals currently favor more downside.
- RSI is nearing oversold levels, meaning a bounce could occur around the $10.00 support.
Conclusion:
- Preferred Trade: Bear Call Spread – Higher probability given current technical weakness.
- Key Watch Levels: $10.00 support and $11.00 resistance.
- Risk Management: Stop-loss if price closes above $11.00 for bearish trades and below $10.00 for bullish trades.
