Groupon vs IBM Which Is More Profitable?

Groupon Inc. and International Business Machines Corporation (IBM) are two prominent companies in the stock market, each with its unique characteristics and performance. Groupon, known for its online marketplace offering discounts on various products and services, has experienced volatility in its stock price due to market fluctuations and competition. On the other hand, IBM, a renowned technology company, has a more stable track record and a long history of innovation. Investors interested in these two stocks should carefully consider their risk tolerance and long-term investment goals.

Groupon or IBM?

When comparing Groupon and IBM, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Groupon and IBM.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Groupon has a dividend yield of -%, while IBM has a dividend yield of 2.9%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Groupon reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, IBM reports a 5-year dividend growth of 1.32% year and a payout ratio of 95.65%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Groupon P/E ratio at 25.73 and IBM's P/E ratio at 33.11. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Groupon P/B ratio is 12.43 while IBM's P/B ratio is 8.66.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Groupon has seen a 5-year revenue growth of -0.82%, while IBM's is -0.22%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Groupon's ROE at 95.71% and IBM's ROE at 27.14%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $12.42 for Groupon and $230.12 for IBM. Over the past year, Groupon's prices ranged from $7.75 to $19.56, with a yearly change of 152.39%. IBM's prices fluctuated between $157.89 and $239.35, with a yearly change of 51.59%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.