$GRPN is a good example that one can easily evaluate its business model and decide if it is a good long term hold.
Even in the absence of business analysis, we can easily see how once the Ichimoku indicators are formed, all signs point to a bearish downtrend.
For those who think it is a good buy because it is now trading at close to $10, here’s some questions to think about.
1. Where is the growth area?
2. How will they increase their margins?
3. What new products or services are they launching that will dramatically change the way they do business and hence, increase revenue?
4. Management. The accounting issue is serious. After addressing this issue, will there still be growth?
I do not have answers to all those. However, the Ichimoku chart suggests Â a strong downtrend.
And just because it is cheap does not mean it is a value buy, is it?