Is Groupon, Inc. overvalued or undervalued?

As of 11 March 2025, Groupon, Inc. has moved from a fair to a risky valuation grade. The company appears to be overvalued given its high Price to Book Value of 36.29 and an EV to Sales ratio of 3.37, which are significantly elevated compared to its peers. Additionally, the company's ROE stands at a concerning -75.61%, indicating severe inefficiencies in generating returns for shareholders.
In comparison to peers, Chewy, Inc. has a P/E ratio of 44.86 and an EV to EBITDA of 69.06, while Global Industrial Co. shows a fair valuation with a P/E of 23.39 and an EV to EBITDA of 15.52, highlighting the disparity in valuation metrics within the sector. Despite a strong year-to-date return of 84.53% compared to the S&P 500's 12.22%, the long-term outlook remains bleak, with a 5-year return of -13.93% versus the S&P 500's 96.61%, reinforcing the notion that Groupon is currently overvalued.