UPDATE: Stifel Upgrades Groupon on Multiple Positive Factors

In a report published Thursday, Stifel analyst Jordan Rohan upgraded the rating on Groupon (NASDAQ: GRPN) from Hold to Buy, and named a $16.00 price target.

In the report, Stifel noted, “We are increasing our rating on GRPN from Hold to Buy. Even though shares have rallied already, there are at least three reasons why shares should continue to work higher: 1) Growth is accelerating at Groupon's core ‘local' business in the U.S., with stability in most key European markets; 2) Groupon is a leader in mobile commerce, which accounts for half of total transactions in North America today. Continued shift of usage toward app-based e-commerce should work in Groupon's favor; 3) The management team, led by co-founder Eric Lefkofsky, is streamlining operations and improving margins. One key uncertainty is the timing and extent of profitability of Groupon Goods, which accounts for 31% of billings today. To arrive at our $16 price target, we use a blend of 40x 2015 PF EPS, 15x EBITDA and a 4% FCF Yield.”

Groupon closed on Wednesday at $11.55.