We wrote before that Groupon’s (NASDAQ:GRPN) tech purchases may continue, the company has acquired another start-up, Hyperpublic.  The latter focuses on generating location-based information for app developers and can be an add-on to Groupon’s location-based deal service, Groupon Now. Groupon leads the daily deal market and shares this space with players such as LivingSocial and Google (NASDAQ:GOOG) Offers.
Groupon Getting Stingier With its Cash
This trend of acquiring small start-ups at prices not exceeding tens of millions of dollars in indicative of two things. Firstly, as we wrote in Groupon Fights to Keep Users With More Tech Firepower, Groupon needs to urgently differentiate its deal offerings to keep consumers engaged.
Secondly, this may also be indicative of a resource crunch at the company, which is possibly hampering it from making large-scale acquisitions of daily deal clones, much like it did in 2010 and early 2011.
We have updated our analysis for Groupon with a $12.55 price estimate, which is well below the current market price.
- Are Increased Marketing Efforts Really Helping Groupon?
- How Do Groupon’s Gross Billings & Gross Profit Per Customer Vary Across Regions?
- Mid-Year Review: How Does Groupon’s Take Rate Vary Across Regions?
- Groupon Mid Year Review: Stock Up 70% On Growing North America Customer Base
- Groupon’s Stock Soars As Strong North America Results Help Beat Estimates
- What To Expect From Groupon’s Q2 Results
Refer our note on why Groupon’s valuation has fluctuated significantly over the past two years.Notes: