This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Lefkofsky to the Rescue as Groupon Soars

Stocks in this article: GRPNFB

NEW YORK ( TheStreet) -- Groupon (GRPN) surged Thursday after the online retailer announced that Eric Lefkofsky had been named the Chicago-based company's new CEO.

Shares were soaring 26% to $10.98, its highest price since June 2012 but well off its record high of $26.19, reached two weeks after the company held its initial public offering raising $700 million on shares priced at $20.

Lefkofsky, one of Groupon's co-founders, was previously named interim co-CEO with fellow board member Ted Leonsis after former CEO Andrew Mason was fired in February in the wake of a series of disappointing financial results. The duo has searched for new expansion opportunities, including offerings through smartphones and tablets. Lefkofsky's 17% stake in the company makes him Groupon's largest shareholder.

"The Board is encouraged by Groupon's performance under Eric's leadership, and we're pleased that he has agreed to lead the company through this important stage of its evolution," said Leonsis, now serving as Groupon's Chairman, in a statement.

Groupon beat analyst expectations in the second quarter with its earnings report Wednesday. The company as revenue rose 7.1% to $608.7 million. Wall Street had expected to see a net loss of 3 cents a share, but saw the company only report a loss of 1 cent per share. Groupon was able to increase billings by 9.9% to $1.41 billion the last quarter. It projects third quarter revenue will come in between $585 million to $635 million. Lefkofsky has authorized a $300 million share buyback program.

Analysts saw expectations beat with the second quarter results but still remain cautious due to long term risks. According to data compiled by Bloomberg, 5 have placed a "buy" rating on the stock, 17 rated it a "hold" and 2 deemed it a "sell." UBS analysts have placed a $11 price target on Groupon stock.

While we remain guarded on LT value of the deal bank for merchants (due to potential pricing cannibalization), our cautious view on 2013 gross margins and CSOI estimates is not playing out and we are upping our rating to Neutral from Underperform," wrote Bank of America analysts, led by Justin Post, in a report released August 8.

-- Written by Robert Arenella in New York

>To contact the writer of this article, click here: Robert Arenella.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,380.41 +263.17 1.63%
S&P 500 1,886.76 +24.00 1.29%
NASDAQ 4,258.4380 +41.0480 0.97%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs