Groupon, Inc. (NASDAQ: GRPN) had such an awful performance on Friday that it should make any rational investor fear more than just a slightly weak to mixed earnings report. Main Street was just not ready to deal with the news that the company released.

The actual earnings report, released after Thursday’s close, was good on the surface. Groupon’s fourth quarter operating income outside of items was $47.9 million or $0.04 per share on revenue of $768.4 million. Thomson Reuters had estimates of $0.02 per share and $718.04 million in revenue. The company’s gross billings were $1.6 billion and adjusted EBITDA was $72.0 million.

Where Groupon missed the mark was on guidance, and, after evaluating a day’s performance., it seems that the quality of reporting ahead just doesn’t sound strong. We previously noted on guidance:

The first quarter of 2014 is being forecast between $710 million and $760 million in revenue (versus $668.8 million expected), and non-GAAP earnings between a loss at -$0.04 to -$0.02 per share. That number still seems to include charges from items, so we are not counting it as finite yet. Groupon also said that due to growth investments it expects adjusted EBITDA for the full year to be slightly above 2013 levels.

Most analysts pulled their ripcord on Groupon, too. The deals site was downgraded to Underperform from Sector Perform at RBC Capital Markets. Bank of America Merrill Lynch also lowered its target down to $11 from $13, while Evercore Partners slashed its target down to $8. Credit Suisse also lowered estimates and maintained a Neutral rating. Deutsche Bank and Stifel Nicolaus maintained their Buy ratings, but the target price was dropped down to $12 from $16 at Deutsche Bank and the target was cut to $14 from $15 at Stifel.

Groupon’s stock closed up 2.6% at $10.28 on the day of the earnings report, and the initial reaction was just down almost 3% at $9.71. Then the after-hours reaction turned south, and Friday’s drop was a whopping 21.9% to $8.03 with a high during the day of only $8.97 and a low of $8.03. This means that the panic and carnage only built all day, and the intraday chart confirms this.

What was particularly troubling about Friday’s drop was that it took place on almost 140 million shares trading hands. That is more than 7-times normal volume, but the raw number of shares just sounds alarming.

Options trading was very high as well. Groupon saw more than another 60,000 contracts trade in the February put options as well. If there is any good news, it may be that over 47,000 of the next month March call options traded – more than the entire prior day’s open interest for that month.

Still, Groupon now looks crippled. The company’s investments and acquisitions should be paying off. Many investors consider this a daily deals site, and some throw the social media aspect on it. Frankly, Groupon is becoming harder and harder to describe. Its market price drop on Friday also took the value of the company down to under $5.4 billion.

Groupon has set the stage for a very rocky 2014. It is hard to believe that Friday’s reaction was simply a daily deal on the company’s stock.

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