Less than three weeks after debuting on the public market, reaching share prices above $26, Groupon (GRPN) shares have fallen to between $17-$18. The stock price has fallen more than 33% in the past three days. Investor’s original optimism at the IPO has waned due to fears that the rising number of competitors in the daily deal market, including Amazon (AMZN), Google (GOOG), and LivingSocial, will limit the future growth and profit margins of the trend setter. Analysts also cite Groupon’s stock as a strong candidate for short-selling. Will the largest daily deal site’s time at the top come to a close in the wake of competitors?
Bank of America (BAC), JP Morgan (JPM), and other national banks still receive a large amount of public scrutiny for widespread economic issues, forcing negative consequences upon their market values. US Bancorp (USB) has flown under the radar, identified as a regional bank therefore left out of the federal fights. The stock has traded between $21-$28 over the past year, and a 2% dividend, with a strong outlook. The majority of revenue is derived from asset management and payment processing, rather than traditional loan based models used by peers, better cushioning them from economic fluctuations. Will USB break through its previous trading range by the end of the year?
One of the most common short sale darlings in recent years, Sirius XM (SIRI), has made significant strides from its $0.13 low during the 2009 economic crisis to eclipse $2.00 per share, settling below that mark over the past few months. Technical traders see potential for SIRI to bust beyond resistance levels, citing it trading just below its 200-day moving average of $1.88. What’s more likely: SIRI breaks through previous resistance levels and trigger technical traders to buy or short sellers come back to the party and push the price down?
Billionaire investor and market guru Warren Buffett announced this week he purchased a significant number of IBM (IBM) shares recently, citing the company’s customer’s switching costs as its major competitive advantage over others in their industry. IBM has also been buying back shares, in theory increasing the value of its outstanding equity. Is it wise for small-time investors to follow Buffett into IBM, or does the Oracle from Omaha benefit more from a large company than an amateur would?