Groupon Takes a Tumble

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Groupon (NAS: GRPN) stock fell 9.9% Monday to close at less than $5 per share, as analysts expressed doubts about the continued success of the e-discounter. 

Groupon, the premier daily deals website, makes money by selling coupons online and then splitting the revenues from the sales with the merchants.

But marketing expenses are rising, and an analyst named Ken Sena with Evercore Partners has identified the current situation as being a case of rising "daily-deal fatigue," putting a $3 target value on shares and putting a "sell" rating on the stock. Groupon shares have already lost three quarters of their value this year.


Last month's earnings disappointment didn't help the online discount site—the struggling European economy was identified as the primary reason for the miss.

The article Groupon Takes a Tumble originally appeared on Fool.com.

Fool contributorJohn Divineowns shares in none of the companies mentioned above. You can follow him on Twitter@divinebizkidand on Motley Fool CAPS@TMFDivine.The Motley Fool has adisclosure policy. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.

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