Everyone loves a good turnaround story, especially when it brings in significant profits for investors. Not too long ago these companies were considered failures, and felt the wrath of Wall Street and short sellers. These companies appear to be making a recovery, and recent quarterly guidance seems to indicate that the worst is behind them, and the future is bright.
One of the most notable turnarounds in recent history has been Domino’s Pizza, Inc. (NYSE:DPZ) when the company admitted their products suck, and so did their stock, which traded at a historically all-time low of under $4 a share back in 2009. The turnaround began in 2010 when the company publicly admitted their pizzas suck and built a creative, never before seen campaign based on the fact. Fast forward to 2013, the stock is hitting a historical all-time high of over $55 a share, following the company’s 2013 first quarter net income of $0.59 a share above the $0.55 consensus. This also marked the third consecutive quarter of growth in domestic order counts year over year. Meanwhile, Domino’s Pizza, Inc. (NYSE:DPZ)’s largest rival Pizza Hut reported a 1% drop in domestic order counts. Domino’s Pizza, Inc. (NYSE:DPZ)’s has clearly established themselves as an investor and costumer favorite. I am upbeat on the company’s outlook, and would not be surprised to see the stock hit $65.
Groupon Inc (NASDAQ:GRPN)’s stock is no longer trading at a huge discount
Groupon Inc (NASDAQ:GRPN) recently released their 2013 first quarterly results, which surprised the naysayers and confirmed what the bulls believed all along: Groupon Inc (NASDAQ:GRPN) is a winner. The company began showing investors that their business is sustainable over the long term, and management can continue growing the company moving forward. Groupon Inc (NASDAQ:GRPN) would have earned $0.03 a share had it not been for a one time item expense, so the company reported a loss of $4 million ($0.01 a share), compared to an $11.7 million loss ($0.02 a share) in the previous year. North American sales climbed 42.3% to $339.6 million, of which 45% of those are from a mobile device, a segment that remains a key driver for future business. The company noted more than 7 million downloads of their mobile app during the first quarter. All around, the company has drastically improved since their CEO was fired after the disappointing 2012 fourth quarter. The stock has more than doubled since their historical $2.60 low, but still has a long way to go to surpass their IPO price of around $26 a share. Equity research firm Piper Jaffray is optimistic about the company’s future, and has a $9 price target on the stock and maintains an overweight rating.
