The Zacks Analyst Blog Highlights: RetailMeNot, Google, eBay, Groupon and Expedia

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May 27, 2014, 09:30 ET

CHICAGO, May 27, 2014 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the RetailMeNot (Nasdaq:SALE-Free Report), Google (Nasdaq:GOOGL-Free Report), eBay (Nasdaq:EBAY-Free Report), Groupon (Nasdaq:GRPN-Free Report) and Expedia (Nasdaq:EXPE-Free Report).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Friday's Analyst Blog:

RetailMeNot Plunges on Google Platform Upgrade

Shares of digital coupon marketplace RetailMeNot (Nasdaq:SALE-Free Report) plunged nearly 19% on fears of a 33% reduction in visibility following Google's (Nasdaq:GOOGL-Free Report) Panda 4.0 search engine upgrade.

Google announced the change on May 20, following which, a digital marketing software provider Searchmetrics published a report mentioning the names of companies that would either win or lose as a result.

Google is making the change in order to increase the relevance of search results by making them less spammy. According to Searchmetrics, the upgrade is a major one, impacting not just RetailMeNot, but also companies like IAC Interactive and eBay (Nasdaq:EBAY-Free Report).

Company officials said that the impact on RetailMeNot was overstated and pointed out that the company had effectively dealt with search engine algorithm changes in the past.

RetailMeNot is not a coupon-selling site like Groupon (Nasdaq:GRPN-Free Report), although there are similarities. Unlike Groupon, it is not restricted to smaller, local sellers but includes deals from many well-known companies. People with the intention to buy something visit its marketplace for the best deal and are able to complete the purchase immediately. The convenience of the exercise has drawn millions of users from across the world. RetailMeNot also generates some revenue from advertising on its properties.

This kind of news highlights the important role of search engines in driving business to content and marketing websites. Google has punished big players like Expedia (Nasdaq:EXPE-Free Report) in the past when they fell short of its required standards. But those companies are better equipped to deal with such issues. Relatively smaller players like RetailMeNot may find it more challenging to alter their content to meet Google's standards.

However, it would no doubt be more profitable to fall in line with Google because the company remains the leading provider of search services (67.6% of search queries in April 2014). This is more than twice the volume serviced by the number two player Microsoft (18.7%).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

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