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John Purdum

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  • Groupon: An Unappreciated Business Set To Fly High [View article]
    Not to article drop, but Groupon's biggest problem is they're just not relevant any longer. I called this over a year ago...
    Dec 4, 2012. 02:38 PM | Likes Like |Link to Comment
  • Why I'm Buying Groupon [View article]
    I certainly respect the author's opinion regarding GRPN but I really struggle to see how anyone can have even the slightest positive outlook regarding the company. The reduction in GRPN's merchant base has forced them to purchase bulk liquidation junk and sell it to their dwindling customer base in the familiar "deal" form. The quality and frequency of merchant driven deals has decreased exponentially while Google Offers continues to gain market share. Even though their business will almost certainly completely fail over the next year or two, the biggest elephant in the room is the SEC. GRPN seriously exposed themselves with it's "guidance" revision (I prefer to call it "confession of fraud") a few weeks back. When I wrote an article about GRPN shortly after its IPO in November, I focused on competition as being the primary cause for its failure but now think the SEC will beat the competition to the punch. I think we're going to see a continuation of the same accounting blunders over the next few quarters as well as increasingly negative earnings. I think within a month of their May 14th earnings release, the stock will follow a path very similar to Pandora and trade between $5 and $7 and continue downward throughout the year.
    Apr 19, 2012. 06:20 AM | 1 Like Like |Link to Comment
  • The Apple Bubble Is Ready To Burst [View article]
    To clarify my point, again; Apple is the only company that has a following that would cause an article's comments section to spin completely out of control like. Assuming LK isn't completely out of his mind I am guessing he knew this would happen. Think of any other publicly traded company that could cause this type of uproar and I'll reassess, but I'm pretty sure you won't have much luck. I think you're talking it too seriously by feeling jabbed by the fact Apple, a well-performing company, wasn't give the credit it deserves. This article doesn't deserve that level of thought or consideration. It's a path any one of SA's contributors could take but good judgement prevents it from occurring for the most part. The best thing everyone can do is quit reading it.
    Jan 8, 2012. 02:56 PM | 2 Likes Like |Link to Comment
  • The Apple Bubble Is Ready To Burst [View article]
    $57 is probably an insignificant fraction in comparison to the amount of money LK has made by writing this article; one which dares to challenge the overwhelmingly cultish aura surrounding the typical Apple enthusiast.
    Jan 6, 2012. 06:42 PM | Likes Like |Link to Comment
  • The Apple Bubble Is Ready To Burst [View article]
    I feel Apple has some challenges ahead which will result in some downside, but as a pragmatic investor I see this as an opportunity. Even if you don't like Apple at all you can't deny the fact that its a great company. From a capital appreciation perspective, as of today, Apple is undervalued by over 30%. This is based on past earnings growth in conjunction with future earnings estimates so it fluctuates, but not by 80%. With some of the recent quality issues Apple has had, increased competition in the tablet market and estimates for Android growth Apple will probably see earnings tail off a bit over the next couple of years with more dramatic downside over the next couple of quarters. With that said, in an absolute worst case scenario I could see Apple dropping into the $250.00 - $300.00 range, but Apple's assets would literally have to start evaporating before it hits $85.00.
    Dec 1, 2011. 04:59 PM | Likes Like |Link to Comment
  • Starbucks [View instapost]
    I think Starbucks (SBUX) acquiring Green Mountain (GMCR) would benefit both companies. Green Mountain needs an image/management cleanse and Starbucks could introduce Keurig machines / K-Cups in growth/emerging markets. Also, Starbucks could supplement the not-so-great Seattle's Best brand with the Green Mountain brand. I'm not sure how much international exposure Keuring has but it would be a great time for Starbucks to brand that as part of their product line. Especially sales through new store openings in the growth markets.
    Nov 28, 2011. 03:47 PM | Likes Like |Link to Comment
  • Starbucks [View instapost]
    I've got my eye on Starbucks as well. Its sitting on nearly 2 billion in cash and I think we'll see another acquisition sometime during the next 2 to 3 months. I personally feel its going to be Dean Foods (DF) since Starbucks is the #1 consumer of milk on planet. Starbucks would also benefit from Dean's distribution infrastructure as well as Dean's existing product/brand line. Instantly pick up additional consumer markets.
    Nov 28, 2011. 03:02 PM | Likes Like |Link to Comment
  • Can Groupon Compete? Not Likely [View article]
    My wife and I are the same way. We don't click ads because we know where to go when we're making a purchase on the web. I think it has to do with spending habits. I am willing to spend a few extra dollars for convenience and speed. However, I've kept in touch with clients from my consulting days and have found that many of them have actually vastly increased budgets for click advertising. My guess is that most individuals in your family are above average computer / web users.
    Nov 23, 2011. 07:23 PM | Likes Like |Link to Comment
  • Can Groupon Compete? Not Likely [View article]
    Robert, great questions. As for your first question I can only speculate on the actual number, which I don't want to do, but I am aware that Google operates a sales force which will support Google Offers. In reference to your comment on Google's partnerships with smaller outfits, I believe this will be one of the benefits of Google Offers provides from a vendor perspective. I'm hoping that Google Offers is similar to their other vendor related services in that a vendor can configure and deploy a Deal campaign without having to interact with a support team. At the same time, Google would have specialists available for the smaller vendors if necessary. As to your second question, I'm almost at a position where Groupon as a brand has essentially become immaterial. Google's value lies in it's ability to provide large vendors with channel support and smaller vendors with a new channel altogether. Google in its own right is a huge brand with global recognition. It maintains a set of services utilized by billions which vendors large and small will have targeted access to. This is something Groupon will never be able to achieve. So, will Google be able to absorb market share from Zappos? No, they won't even try; but they can certainly help Zappos sell more shoes. There are other factors to consider as well. Google maintains a staff of, very literally, the brightest minds available, who aren't necessarily concerned with the business aspect of developing great software. They are in the game for the sole purpose of developing great software. Granted, the business side of Google must love this; nevertheless this attitude, in my opinion, will always catapult Google ahead of its competition.
    Nov 10, 2011. 09:43 PM | Likes Like |Link to Comment