Aswath Damodaran, a finance professor at New York University, said although Groupon (GRPN) stock price has fallen for 13th consecutive day, but this downtrend has not yet bottomed.
GRPN stock price closed at $4.19 Tursday, a decrease of 78% compared to its IPO price of $20. According to statistics, the cumulative decline of GRPN price is biggest among the IPO stocks in the U.S. capital market over the past 12 months.
Damodaran currently values Groupon at $4.07 per share, much lower than his original valuation of $14.62 per share, given that he has underestimated the disappearing speed of Groupon’s first-mover advantage. Damodaran means that although Groupon has begun to start the group buy business relatively early, it is hard to see the company will stand out from the crowd and meanwhile earn money.
GRPN stock price’s most recent gain happened on August 13, and since then GRPN stock price has fallen more than 44%. This round decline initiated after the company reported its second-quarter revenue below the average estimate of analysts.