These 4 IPOs Are Doomed
3. Groupon (GRPN)
Groupon is worth an astonishing $14 billion. That's the same as the combined market capitalization of New York Times (T), Abercrombie & Fitch (ANF), Hasbro (HAS) and Weight Watchers International (WTW).And yet Groupon has never earned a dime.
At $430 million in revenue in the most recent quarter, it came very close to breaking even -- but still lost $10 million. Groupon needs $640 million in net profit to justify its current market cap, which puts it in the neighborhood of companies like NYSE Euronext (NYX) and Ralph Lauren (RL).
Are you kidding? In a little more than a month since its debut, Groupon has lost nearly 15% of its market cap. This is a company that is just begging to be shorted. There is simply no way it can ever meet the market's expectations. WallStreet cheered for this company because it wanted to see a big-dollar, high-tech IPO. But it wanted that because those deals make investors feel better about the future. The IPO itself? Doomed to a Pets.com-style flameout. Mark my words.Select the service that is right for you!
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