Groupon ($GRPN) Ends First Week on NASDAQ Alive, But How Bloodied?


The Greatest IPO In Daily Deals History, Groupon, debuted last week on NASDAQ to much fanfare, hype, naysaying, and bloggers like us huffing into paper bags and praying for deliverance from Groupon Cat. One week later, and how’s it doing?


Last Thursday night, GRPN’s IPO was priced at $20.

On Friday morning, GRPN opened and peaked early at $31.40.

By Friday afternoon, GRPN had shrunk down to $26.11.

One Friday later, and GRPN is closing at $24.25. It’s hanging in there, but you’re starting to see the deflationary counteraction against hype, pushing it down. It’s not a huge loss, but take a look at Groupon’s wild week:

If you can’t tell, Wednesday morning was not a happy one at Groupon HQ. The stock opened at what’s currently its all-time low of $22.76—remember, the IPO price was $20, and for Groupon to fall below the IPO pricing in its first week on the market wouldn’t be fun—when some people who likely thought they’d be catching it on the cheap rolled in and helped pick it back up, but not before another sell-off later in the day. Sleazy day traders who got in at the bottom of the downward break did okay, as the difference between Wednesday morning and now is $1.49, assuming they purchased, like, 10,000 shares, and didn’t screw the pooch on anything else since. Which, in this theoretical scenario, we find unlikely.

The short-sellers, on the other hand, have done pretty well. People have been talking about the various reasons and schemes to short GRPN (or: bet that GRPN’s going to drop in price) since last week, and they’re still talking about it this week. In fact, so many people are now shorting GRPN, it’s becoming more and more difficult to convince anyone to be on the other side of the bet; and yet, despite being a pricey bet to make, people are still doing it. There have been arguments as to why this is a bad bet either way because of the basically anything to do with Groupon is totally crazy like the contagious IPO crazy-eyes of potential tech investors, which clearly have yet to subside and won’t for another few weeks or IPOs—whichever comes first—but in the mean time, Bloomberg has a great explainer on why the Groupon short might end up being totally unreasonable and not the best thing to do. Just because you hate Groupon Cat doesn’t mean you have to lose your shirt hating it. Remember that.

But what’s the next week hold for Groupon? Via Don Young Jr. at Daily Deal Media:

Over the next year, I believe GRPN will undergo wild swings of between 10 to 40% in a day.

So, actually, maybe longer than a few weeks if you’re feeling particularly nasty and/or paranoid. Either way, hang on to your Groupon Cats. Whatever the time frame actually is, it’ll continue to be a wild ride. Groupon ($GRPN) Ends First Week on NASDAQ Alive, But How Bloodied?