Groupon stock continued its plunge Wednesday, trading in the $17 range, well below the company's $20 IPO price.

It's the third consecutive day the stock has plummeted; shares fell 10% Monday and nearly 15% Tuesday. On Wednesday afternoon shares were trading for $16.99.

While it's difficult to define shareholder intention — many short sellers have accelerated the plunge by betting on the stock to continue sliding — public perception of the daily deals site has made a clear negative shift.

A pair of accounting changes this autumn had already raised the ire of some Groupon skeptics. In August, the company was criticized for using an unusual accounting practice that disguised some of its losses to depict itself as profitable. In September, the company announced another major accounting change that essentially halved its revenue.

Nonetheless, Groupon enjoyed a smashing IPO on November 4, with shares soaring more than 30% in the company's market debut. It was the largest tech IPO of its kind since Google went public in 2004.

"Frankly, I'm surprised it did so well," Ed Woo, an analyst at Wedbush Securities, told CNN. "Now, that negative sentiment is coming back as investors are focusing on the company's slowing growth and how it's losing a lot of money."

There are also several other factors that may be contributing to the sudden plunge.

LinkedIn shares dropped this week, and are now trading at about half their peak summer value, after the company's 180-day lockup period ended on Monday. The lockup period is a common IPO method of barring early-stage investors from abandoning their stakes in a company. Groupon's lockup period ends May 2, and many analysts have speculated that fears of a similar subsequent drop may be driving traders to ditch the stock now.

Analysts have also cited increased competition from Living Social, as well as concerns about whether Groupon will be able to continue attracting small business customers. Living Social this week announced Black Friday deals from more than 20 national retailers including Verizon Wireless and Electronic Arts.

Questions about Groupon's ability to continue finding small businesses to partner with on deals rose after a recent episode in which an England bakery lost some $20,000 following a deal that deeply discounted cupcakes. Groupon's actual customers aren't the millions of people who receive email offers, but the businesses — often small ones with little margin for error — that agree to partner with Groupon on deals.

"Without a doubt, it was my worst ever business decision," Need A Cake owner Rachel Brown told the BBC of the deal that had her and her employees baking more than 100,000 cupcakes to sell at a 75% discount.

Such deal offerings can be beneficial for large companies seeking to reach many people and attract new customers, as well as to businesses willing to bet a short term loss for possible future gains. But cupcake-gate illustrates the risk of daily deals like Groupon's to smaller businesses.

And with Groupon's recently plunging stock, it now appears stockholders are also beginning to see the company's potential as too good to be true.

"The market has begun to increase its discount on risk and that has impacted all companies without a proven track record and/or earnings," Hudson Square Research analyst Daniel Ernst told Mashable on Wednesday.

A Groupon spokesman said the company is currently in a "quiet period" and can't comment, while the company's external public relations agency also declined to comment on "the stock action."

Image courtesy of iStockphoto, slobo