Groupon shares fall as executive plans to leave
Shares of Groupon Inc. fell Tuesday, a day after the daily-deal site said that one of its senior executives is leaving the company next month.
Jeffrey Holden, a senior vice president of product management, will leave Groupon March 18. He will join another company, which Groupon did not name. The other company it is not competitor, said Groupon spokesman Bill Roberts. Holder's responsibilities will be divided among other members of the team, Roberts said.
Groupon announced the departure in a Securities and Exchange Commission filing Monday.
Holden joined the Chicago-based company April 2011 after Groupon bought his startup Pelago. Before Pelago, Holden worked at online retailer Amazon.com Inc. for eight years.
Deutsche Bank analyst Ross Sandler initially called the departure a "potential red flag" in a morning note to clients, but he later changed his mind and said that Holden's move is a "natural evolution for the company." Sandler said he learned new information about Holden's departure that caused him to change his opinion. He called Tuesday's sell-off an "over reaction." Sandler kept a "Buy" rating on Groupon's stock, saying that the company has other talented executives and its recent acquisition of flash-sale retailer Ideeli could increase growth.
Another analyst, Arvind Bhatia from Sterne Agee, also kept his "Buy" rating on Groupon's stock, citing its "turnaround potential." Groupon has been changing its business to become a one-stop destination for bargain hunters, and not just selling daily-deals for restaurants, spas and gyms. It now sells items such as TVs and iPhone chargers at discounted prices and offers free coupons from local and national retailers.
Shares of Groupon fell 68 cents, or 6.1 percent, to close at $10.40 Tuesday. Its shares have nearly doubled from a year ago, but have fallen 48 percent since its initial public offering price of $20 in November 2011.