Analyzing LY (OTCMKTS:YAHOY) and Groupon (NASDAQ:GRPN)

Groupon (NASDAQ:GRPN) and LY (OTCMKTS:YAHOY) are both consumer discretionary companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, profitability, earnings, institutional ownership and dividends.

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Groupon	$497.41 million	1.72	-$83.52 million	($3.11)	-6.78
LY	$13.53 billion	1.80	$1.28 billion	$0.39	18.10

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

Insider & Institutional Ownership

90.1% of Groupon shares are owned by institutional investors. 36.6% of Groupon shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Risk & Volatility

Groupon has a beta of 0.24, indicating that its share price is 76% less volatile than the S&P 500. Comparatively, LY has a beta of 0.9, indicating that its share price is 10% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and price targets for Groupon and LY, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Groupon	2	1	1	0	1.75
LY	0	2	0	0	2.00

Groupon currently has a consensus target price of $26.00, suggesting a potential upside of 23.27%. Given Groupon’s higher possible upside, equities analysts clearly believe Groupon is more favorable than LY.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Groupon	-25.26%	N/A	-20.28%
LY	6.24%	5.49%	1.80%

Summary

LY beats Groupon on 10 of the 14 factors compared between the two stocks.

About Groupon

Groupon, Inc., together with its subsidiaries, operates a marketplace that connects consumers to merchants. It operates in two segments, North America and International. The company sells goods or services on behalf of third-party merchants. It serves customers through its mobile applications and websites. The company was formerly known as ThePoint.com, Inc. and changed its name to Groupon, Inc. in October 2008. Groupon, Inc. was incorporated in 2008 and is headquartered in Chicago, Illinois.

About LY

LY Corporation engages in the online advertising and e-commerce businesses in Japan. The company provides LINE, a communication app; and Yahoo! JAPAN, an internet service that offers search, news, weather, shopping, auction, and other services. It also offers reuse, membership, and payment-related services. The company was formerly known as Z Holdings Corporation and changed its name to LY Corporation in October 2023. LY Corporation was founded in 1996 and is headquartered in Chiyoda, Japan. LY Corporation operates as a subsidiary of A Holdings Corporation.