Head to Head Analysis: Groupon (GRPN) & Criteo (CRTO)

Groupon (NASDAQ: GRPN) and Criteo (NASDAQ:CRTO) are both retail/wholesale companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, profitability, valuation, analyst recommendations, risk, institutional ownership and dividends.

Institutional and Insider Ownership

63.6% of Groupon shares are owned by institutional investors. Comparatively, 72.8% of Criteo shares are owned by institutional investors. 23.4% of Groupon shares are owned by insiders. Comparatively, 5.6% of Criteo shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.



Profitability

This table compares Groupon and Criteo’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Groupon 0.49% 0.22% 0.03%
Criteo 3.97% 15.34% 8.84%

Volatility and Risk

Groupon has a beta of 1.4, meaning that its stock price is 40% more volatile than the S&P 500. Comparatively, Criteo has a beta of 1.89, meaning that its stock price is 89% more volatile than the S&P 500.

Valuation & Earnings

This table compares Groupon and Criteo’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Groupon $2.84 billion 0.87 $14.04 million ($0.03) -147.00
Criteo $2.30 billion 0.79 $91.21 million $1.63 16.79

Criteo has lower revenue, but higher earnings than Groupon. Groupon is trading at a lower price-to-earnings ratio than Criteo, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings for Groupon and Criteo, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Groupon 3 9 6 0 2.17
Criteo 0 9 7 0 2.44

Groupon currently has a consensus price target of $4.88, suggesting a potential upside of 10.63%. Criteo has a consensus price target of $42.40, suggesting a potential upside of 54.97%. Given Criteo’s stronger consensus rating and higher possible upside, analysts plainly believe Criteo is more favorable than Groupon.

Summary

Criteo beats Groupon on 11 of the 14 factors compared between the two stocks.

Groupon Company Profile

Groupon, Inc. operates online local commerce marketplaces that connect merchants to consumers by offering goods and services at a discount in North America and internationally. The company provides deals in various categories, including events and activities, beauty and spa, health and fitness, food and drink, home and garden, and automotive; and deals on various product lines, such as electronics, sporting goods, jewelries, toys, household items, and apparel, as well as provides discounted and market rates for hotel, airfare, and package deals. It offers its deal offerings to customers through Websites; search engines; mobile applications and mobile Web browsers, which enable consumers to browse, purchase, manage, and redeem deals on mobile devices; emails; affiliate channels; display advertising; and television and radio advertising. The company was formerly known as ThePoint.com, Inc. and changed its name to Groupon, Inc. in October 2008. The company was founded in 2008 and is headquartered in Chicago, Illinois. Groupon, Inc. is a subsidiary of The Point, LLC.

Criteo Company Profile

Criteo S.A., a technology company, engages in digital performance marketing in France and internationally. The company's Criteo Shopper Graph, which collects clients' proprietary commerce data, such as transaction activity on their digital properties. Its Criteo Engine solutions include recommendation algorithms that create tailored advertisements to specific customer interest by determining the specific products and services to include in the advertisement; predictive bidding algorithms that predict the probability and nature of a user's engagement with a given advertisement; and bidding engine for executing campaigns based on objectives set by the clients. The company's Criteo Engine solutions also consist of kinetic design that assembles customized creative advertising content by optimizing each individual creative component in the advertisement; software systems and processes, which enable data synchronization, storage, and analysis of distributed computing infrastructure in multiple geographies; and experimentation platform, an offline/online platform to enhance the capabilities and effectiveness of prediction models. In addition, it provides real-time access to advertising inventory through its publisher partners. Further, the company offers an integrated technology platform that includes a suite of services and software tools, such as a unified dashboard, which automates campaign execution and management tasks; and consulting services in business intelligence and analytics. It serves companies in the digital retail, classifieds, and travel industries. Criteo S.A. was founded in 2005 and is headquartered in Paris, France.

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