Friday Charts: Groupon Sucks, Dividends Rule
It’s Friday in the Wall Street Daily Nation. That means it’s out with our regular routine of commentary-based articles, and in with the charts.
In our opinion, there’s just no better way to present the week’s most important investment and economic insights than with pictures.
This week, I’m addressing the likelihood of bankruptcy for daily deal company, Groupon (Nasdaq: GRPN). (Hint: it’s increasing.) Then it’s on to proving that dividend stocks always matter.
So let’s get to it…
Groupon’s Still a Goner
On Monday, Groupon reported it’s first ever quarter-over-quarter decline in gross billings, prompting investors to send shares to an all-time low.
Silly Rabbits! If they’d been part of the Wall Street Daily Nation, they would have known to avoid the stock long ago.
Not simply because I railed against the stock months before it went public (see here). But also because I shared my IPO secret. You know, the one about the success of an IPO hinging upon a company’s year-over-year revenue growth rates. If they’re falling, so will share prices.
Well, guess what? Groupon’s revenue growth rates were falling long before it went public. So is it any surprise the stock is following suit? Not to this guy.
I stand by my conviction. Groupon’s destined for the courthouse steps. Probably not next month, but eventually.
Four Decades of Evidence Doesn’t Lie
Hat tip to my colleague, Justin Fritz, for uncovering this nugget, which supports my earlier findings that dividends always matter.
Dylan Grice, over at Societe Generale’s Global Strategy Team, reports that dividends didn’t just help investors build income. Over the last four decades, dividends were practically the only reason investors increased their wealth.
As Grice says, the “chart shows that since 1970, dividends and dividend growth have been pretty much the whole story.” Indeed!
And that’s why we’re dead set on finding companies that not only dish out attractive dividend yields, but have also increased their dividend payouts year after year. So much so, in fact, we created an entirely new, “forever free” newsletter – Dividends & Income Daily – to focus on these opportunities.
Be on the lookout for your first issue, with a link to my special report, Seven Ways to Earn Max Yields in a Zero-Interest World, on Tuesday. (Feel free to manage your subscription here.)
That’s it for this week. Before you go, though, let us know what you think of this weekly column – or any of our recent work at Wall Street Daily – by sending an email to feedback@wallstreetdaily.com, leaving a comment on our website, or catching us on Facebook or Google+.
Ahead of the tape,
Louis Basenese
Related Topics: Earnings, IPOs, Think Contrarian
