Groupon Inc (NASDAQ:GRPN) is trading higher Monday after Prescience Point Capital Management raised its price target on the stock to $88.17.
Prescience Point said it has obtained new information that suggests the value of the company's stake in European payments company SumUp is worth more than Groupon's entire market cap.
Prescience Point highlighted a Bloomberg report from last week, which showed SumUp is considering a capital raise at a valuation around $22.5 billion.
In its initiation report, Prescience Point estimated that Groupon owned about 5% of SumUp, but the investment firm said it was recently informed that Groupon's SumUp ownership stake is in the "mid-single digits," citing a large Groupon shareholder.
Prescience Point now believes Groupon's SumUp stake alone could be worth more than $1 billion. Groupon currently has a market cap of about $800 million, according to data from Benzinga Pro.
Prescience Point thinks these findings "will be the spark that sets off a series of positive catalysts that will drive Groupon shares significantly higher in short order."
From Last Week: What Are Whales Doing With Groupon
Groupon acts as the middleman between consumers and merchants, offering a variety of products and services at discounts via its online store.
GRPN Price Action: Groupon has traded as low as $19 and as high as $64.69 over a 52-week period.
The stock was up 9.74% at $29.75 at time of publication.
Photo: courtesy of Groupon.
