Financial Survey: Groupon (NASDAQ:GRPN) versus carsales.com (OTCMKTS:CSXXY)

Groupon (NASDAQ:GRPN) and carsales.com (OTCMKTS:CSXXY) are both retail/wholesale companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, valuation, earnings, profitability and analyst recommendations.

Analyst Recommendations

This is a summary of recent ratings and target prices for Groupon and carsales.com, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Groupon 1 4 2 0 2.14
carsales.com 0 1 1 0 2.50

Groupon presently has a consensus target price of $41.29, suggesting a potential downside of 9.66%. Given Groupon’s higher possible upside, analysts clearly believe Groupon is more favorable than carsales.com.

Valuation and Earnings

This table compares Groupon and carsales.com’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Groupon $2.22 billion 0.60 -$22.38 million $0.40 114.25
carsales.com N/A N/A N/A N/A N/A

carsales.com has lower revenue, but higher earnings than Groupon.

Profitability

This table compares Groupon and carsales.com’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Groupon -13.34% -31.31% -4.50%
carsales.com N/A N/A N/A

Institutional & Insider Ownership

63.0% of Groupon shares are held by institutional investors. 15.5% of Groupon shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Groupon beats carsales.com on 5 of the 9 factors compared between the two stocks.

Groupon Company Profile

Groupon, Inc. operates a marketplace that connects consumers to merchants. It operates in two segments, North America and International. The company sells goods or services on behalf of third-party merchants; and first-party goods inventory. It serves customers through its mobile applications and websites. The company was formerly known as ThePoint.com, Inc. and changed its name to Groupon, Inc. in October 2008. Groupon, Inc. was founded in 2008 and is headquartered in Chicago, Illinois.

carsales.com Company Profile

carsales.com Ltd engages operates digital automotive marketplace in Australia, South Korea, Brazil, Mexico, Chile, and Argentina. It operates in Online Advertising Services; Data, Research and Services; Latin America; and Asia segments. The Online Advertising Services segment offers classified advertising that allows dealers and consumers to advertise automotive and non-automotive goods and services for sale across the carsales network; and services, including subscriptions, lead fees, and priority placement services on automotive and non-automotive goods and services. It also provides display advertising services, such as placing advertisements on carsales network websites for corporate customers comprising automotive manufacturers/importers, and finance and insurance companies. In addition, this segment holds investments in tyresales.com.au, an online tyre advertisement website that allows consumers to transact and purchase tyres; and RedBook Inspect, which provides inspection services published online as part of classified advertisements. The Data, Research and Services segment offers software, analysis, research and reporting, valuation, and website development and hosting services, as well as photography services. The Latin America segment is involved in the provision of online automotive classifieds and media advertising services. The Asia segment provides online automotive classifieds, media advertising, and automotive data services. carsales.com Ltd was founded in 1997 and is headquartered in Melbourne, Australia.

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