In November of 2011 I posted an update on Groupon and essentially said it was terrible as it made its IPO debut.
Ultimately I felt that Groupon (GRPN) was a strong short because its business model was easy to replicate and it really wasn't fairly valued after its IPO which vaulted it into the stratosphere. I made the argument that GRPN was simply a tech bubble fantasy that would crash back to earth.
In early November, Groupon reached a price of $30.00 a share and on the 22nd of November it was already trading at $22. In my New Year kickoff post for 2012, CONFIDENCE LOST, 13 PREDICTIONS FOR 2012, I went further as I wrapped up the article with the following quote;
"Groupon will be one firm that is out of business in the next 5 years and therefore it is clearly an equity to focus on (to short) if it can ever gain any traction and get a bounce."
Let's check back in on this great technology story and check out where it is trading and where it might be headed. Please examine the chart below;
WHERE IS IT HEADED?
I will spare you the sophisticated technical analysis on this $3.90 stock, and summarize this view on GRPN with this final thought on "Groupon still hasn't formed a bottom".
OTHER TECH NAMES
As I wrote in a recent article, I have softened on LinkedIn (LNKD), I think that is one of the few "internet firms" that has a real business and could be amazing over the very long term. The chart looks ok here too, unless it falls through $101. I love to shop using Priceline (PCLN), but that chart looks really shortable after the monster gap up last week.
The election is tomorrow and I am simply praying that God would give us the candidate that he has for us rather than the leader we are asking for. I'll give you a hint about the people of Israel, it didn't work out very well when Saul was named their king. Read 1 Samuel 8: 6-20 for more insight!
Have a great week
Goatmug is an investor that cares about you and your family. Goatmug's Blog – Financial Perspectives From The Mountain Top is a collection of thoughts on our economy and how it impacts the lives of investors and average people. While several specific investments are named in many of his posts, these articles are simply invitations for you to do your own research and reference to these securities does not constitute financial advice. Your situation is complex and unique and you should seek professional assistance with your trading and investing. Please visit Goatmug and share your comments athttp://www.goatmug.blogspot.com/