Yelp Inc. (NYSE:YELP) Sees Large Increase in Short Interest

Key Points

• Yelp's short interest rose 14.9% in April to 8,660,502 shares — about 15.8% of shares sold short — leaving a days-to-cover ratio of 8.6 days.
• Wall Street sentiment has turned negative, with an average rating of Reduce, multiple downgrades and a consensus price target of $28.50.
• Yelp beat quarterly EPS estimates ($0.61 vs. $0.47) while revenue fell 0.5% year-over-year, and insiders have sold roughly 96,264 shares (~$2.48M) in the last 90 days.

Yelp Inc. (NYSE:YELP - Get Free Report) was the recipient of a large growth in short interest during the month of April. As of April 15th, there was short interest totaling 8,660,502 shares, a growth of 14.9% from the March 31st total of 7,536,779 shares. Approximately 15.8% of the company's shares are sold short. Based on an average trading volume of 1,010,391 shares, the days-to-cover ratio is currently 8.6 days.

Wall Street Analysts Forecast Growth

Several equities research analysts have issued reports on YELP shares. Wall Street Zen cut shares of Yelp from a "buy" rating to a "hold" rating in a research report on Saturday, February 14th. Robert W. Baird set a $25.00 price objective on shares of Yelp in a research report on Friday, February 13th. The Goldman Sachs Group lowered their price objective on shares of Yelp from $33.00 to $25.00 and set a "neutral" rating for the company in a research report on Tuesday, February 17th. Zacks Research cut shares of Yelp from a "hold" rating to a "strong sell" rating in a research report on Wednesday, April 15th. Finally, JPMorgan Chase & Co. lowered their price objective on shares of Yelp from $30.00 to $22.00 and set a "neutral" rating for the company in a research report on Tuesday, February 17th. One analyst has rated the stock with a Buy rating, three have assigned a Hold rating and four have given a Sell rating to the stock. Based on data from MarketBeat.com, Yelp has an average rating of "Reduce" and a consensus price target of $28.50.

Yelp Stock Performance

NYSE:YELP opened at $27.61 on Friday. Yelp has a one year low of $19.60 and a one year high of $41.22. The firm has a market cap of $1.64 billion, a P/E ratio of 12.27, a P/E/G ratio of 0.70 and a beta of 0.47. The firm has a 50-day simple moving average of $25.05 and a 200-day simple moving average of $27.76.

Yelp (NYSE:YELP - Get Free Report) last posted its quarterly earnings results on Thursday, February 12th. The local business review company reported $0.61 EPS for the quarter, beating the consensus estimate of $0.47 by $0.14. Yelp had a net margin of 9.94% and a return on equity of 19.96%. The business had revenue of $359.99 million during the quarter, compared to analyst estimates of $358.70 million. During the same quarter in the previous year, the business posted $0.62 EPS. The company's quarterly revenue was down .5% compared to the same quarter last year. On average, research analysts predict that Yelp will post 2.02 EPS for the current fiscal year.

Insider Activity

In other news, Director Dan Jedda sold 1,464 shares of the firm's stock in a transaction dated Monday, February 23rd. The shares were sold at an average price of $21.02, for a total value of $30,773.28. Following the completion of the sale, the director owned 17,100 shares in the company, valued at approximately $359,442. This trade represents a 7.89% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, insider Craig Saldanha sold 1,200 shares of the firm's stock in a transaction dated Wednesday, April 1st. The stock was sold at an average price of $24.72, for a total transaction of $29,664.00. Following the completion of the sale, the insider owned 267,835 shares of the company's stock, valued at $6,620,881.20. This trade represents a 0.45% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold a total of 96,264 shares of company stock worth $2,476,393 over the last 90 days. Insiders own 8.00% of the company's stock.

Institutional Investors Weigh In On Yelp

Several large investors have recently modified their holdings of the business. LSV Asset Management raised its holdings in shares of Yelp by 11.6% in the 4th quarter. LSV Asset Management now owns 2,682,238 shares of the local business review company's stock valued at $81,513,000 after purchasing an additional 279,300 shares in the last quarter. Dimensional Fund Advisors LP raised its holdings in shares of Yelp by 7.6% in the 4th quarter. Dimensional Fund Advisors LP now owns 2,226,666 shares of the local business review company's stock valued at $67,666,000 after purchasing an additional 156,430 shares in the last quarter. Arrowstreet Capital Limited Partnership raised its holdings in shares of Yelp by 8.3% in the 3rd quarter. Arrowstreet Capital Limited Partnership now owns 1,976,150 shares of the local business review company's stock valued at $61,656,000 after purchasing an additional 151,354 shares in the last quarter. Ameriprise Financial Inc. raised its holdings in shares of Yelp by 7.0% in the 2nd quarter. Ameriprise Financial Inc. now owns 1,501,764 shares of the local business review company's stock valued at $51,458,000 after purchasing an additional 98,303 shares in the last quarter. Finally, River Road Asset Management LLC raised its holdings in shares of Yelp by 1.4% in the 4th quarter. River Road Asset Management LLC now owns 1,161,711 shares of the local business review company's stock valued at $35,304,000 after purchasing an additional 15,849 shares in the last quarter. Institutional investors own 90.11% of the company's stock.

About Yelp

Yelp is a digital platform that connects consumers with local businesses through user-generated reviews, ratings and multimedia content. The company's flagship offerings include the Yelp website and mobile applications for iOS and Android, where users can search for and discover restaurants, shops, service providers and other points of interest. In addition to crowd-sourced reviews and photographs, Yelp provides business profile pages featuring hours, contact information, menus and direct messaging capabilities.

Yelp generates revenue primarily through advertising services sold to small and medium-sized enterprises.

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