Coupons plummeted -30% AHT

Coupons (COUP) will plunge tomorrow. Down -31% AHT. Incorporated operates a digital promotion platform that connects great brands and retailers with consumers. The company has over 2,000 brands from more than 700 consumers packaged goods companies (CPG) and many of the grocery, drug and mass merchandise retailers use its promotion platform to engage consumers when they are choosing which products they will buy and where they will shop.

The company delivers digital coupons to consumers, including coupons and coupon codes, and display advertising through its platform, which includes its Web, mobile and social channels, as well as those of its CPG`s, retailers and its network of approximately 30,000 third-party websites, or publishers, that displays its coupon and advertising offerings on their sites.

Last year was a very successful year for the company and they continue to grow. They delivered 32% revenue growth over last year, with solid momentum in all areas of their business. Total revenue for the fourth quarter last year was $60,0 million, compared to $52,6 million for the comparable period in 2013.

GAAP net loss for the fourth quarter 2013 was $1,7 million, which included $7,8 million in stock-based compensation expense. GAAP net income in 2013 was $1,5 million, which included stock-based compensation. Adjusted EBITDA for the fourth quarter 2014 was $8,3 million, compared with $5,3 million for the fourth quarter 2013.

Retailer iQ continued to drive consumer engagement on mobile devices. Over 70% of the Retailer iQ platform usage is via mibile. Other mobile initiatives in 2014 included their partnership with Samsung. The launch of Card Linked Offers and additional enhancements to their popular app.

Their outlook for the first quarter in 2015 is total revenue in a range of $52,0 million to $54,0 million. Adjusted EBITDA is expected to be in the range of $1,0 million to $3,0 million.

For the full year 2015, their total revenue is expected to be in the range of $275,0 million to $290,0 million. They anticipate a stronger growth rate in the back half of 2015 as compared to the first six months of 2015 due to the anticipated Retailer iQ volume ramp.

Adjusted EBITDA for the full year 2015 is expected to be in the range of $40,0 million to $50,0 million, reflecting significant margin expansion over last year. As of December 31, 2014, had $201,1 million in cash and cash equivalents and generated $11,5 million in cash from operations in the year.

They have a strong revenue growth, a non-cash burning model and som positive things going on, but the shares are still priced at 5 times Price to sales and 4 times Price/book. A stock to put on the watch list.


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