Yelp (NYSE:YELP) Shares Up 6.5% - Should You Buy?

Key Points

• Yelp shares rose 6.5% in Tuesday trading, reaching as high as $22.88 before last trading around $23.20. Volume was far below average, with just 86,457 shares changing hands versus a typical 1.32 million.
• Recent analyst actions have been mixed, but the overall tone remains cautious: the consensus rating is currently “Reduce” with an average price target of $27.88. Upgrades and target changes from firms like Zacks, Morgan Stanley, Evercore, and Baird reflect differing views on Yelp’s outlook.
• Yelp’s latest earnings beat expectations, posting $0.30 EPS versus the $0.26 estimate and revenue of $361.46 million versus the expected $353.47 million. Even so, revenue growth was modest year over year, and the stock still trades below its 50-day and 200-day moving averages.

Yelp Inc. (NYSE:YELP - Get Free Report)'s stock price shot up 6.5% during trading on Tuesday . The company traded as high as $22.88 and last traded at $23.1970. 86,457 shares traded hands during mid-day trading, a decline of 93% from the average session volume of 1,319,698 shares. The stock had previously closed at $21.79.

Analyst Upgrades and Downgrades

A number of equities analysts have recently issued reports on YELP shares. Zacks Research upgraded Yelp from a "strong sell" rating to a "hold" rating in a report on Thursday, May 14th. Weiss Ratings reaffirmed a "sell (d+)" rating on shares of Yelp in a research note on Monday, May 11th. Evercore set a $30.00 price objective on Yelp in a report on Monday, May 11th. Morgan Stanley lowered their target price on Yelp from $28.00 to $24.00 and set an "underweight" rating for the company in a research note on Friday. Finally, Robert W. Baird set a $28.00 price target on shares of Yelp in a report on Friday, May 8th. One investment analyst has rated the stock with a Buy rating, four have assigned a Hold rating and three have assigned a Sell rating to the stock. According to data from MarketBeat, the company currently has a consensus rating of "Reduce" and an average price target of $27.88.

Yelp Trading Up 3.1%

The company has a quick ratio of 1.74, a current ratio of 1.74 and a debt-to-equity ratio of 0.21. The firm has a market cap of $1.24 billion, a P/E ratio of 10.27, a PEG ratio of 2.28 and a beta of 0.53. The firm's fifty day moving average is $25.61 and its two-hundred day moving average is $27.11.

Yelp (NYSE:YELP - Get Free Report) last announced its quarterly earnings results on Thursday, May 7th. The local business review company reported $0.30 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.26 by $0.04. Yelp had a net margin of 9.47% and a return on equity of 20.19%. The company had revenue of $361.46 million for the quarter, compared to analysts' expectations of $353.47 million. During the same quarter in the previous year, the company earned $0.36 earnings per share. Yelp's quarterly revenue was up .8% on a year-over-year basis. Analysts predict that Yelp Inc. will post 1.88 earnings per share for the current fiscal year.

Insider Activity

In other Yelp news, insider Craig Saldanha sold 1,200 shares of the stock in a transaction on Wednesday, April 1st. The stock was sold at an average price of $24.72, for a total value of $29,664.00. Following the completion of the transaction, the insider owned 267,835 shares in the company, valued at approximately $6,620,881.20. This represents a 0.45% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. Also, Director Dan Jedda sold 1,464 shares of the company's stock in a transaction dated Monday, February 23rd. The stock was sold at an average price of $21.02, for a total transaction of $30,773.28. Following the completion of the sale, the director directly owned 17,100 shares in the company, valued at $359,442. This represents a 7.89% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold a total of 28,864 shares of company stock worth $723,573 in the last quarter. 8.30% of the stock is owned by company insiders.

Institutional Trading of Yelp

Hedge funds have recently made changes to their positions in the stock. Bfsg LLC grew its position in Yelp by 110.3% during the 3rd quarter. Bfsg LLC now owns 839 shares of the local business review company's stock valued at $26,000 after purchasing an additional 440 shares during the last quarter. CIBC Private Wealth Group LLC grew its stake in shares of Yelp by 100.0% in the third quarter. CIBC Private Wealth Group LLC now owns 892 shares of the local business review company's stock worth $28,000 after acquiring an additional 446 shares during the period. Fifth Third Bancorp boosted its holdings in Yelp by 70.4% in the fourth quarter. Fifth Third Bancorp now owns 1,159 shares of the local business review company's stock worth $35,000 after purchasing an additional 479 shares during the last quarter. Rockefeller Capital Management L.P. grew its holdings in shares of Yelp by 71.3% in the fourth quarter. Rockefeller Capital Management L.P. now owns 1,158 shares of the local business review company's stock worth $35,000 after acquiring an additional 482 shares during the period. Finally, Hantz Financial Services Inc. grew its stake in shares of Yelp by 181.3% during the 4th quarter. Hantz Financial Services Inc. now owns 1,297 shares of the local business review company's stock valued at $39,000 after purchasing an additional 836 shares during the period. 90.11% of the stock is owned by institutional investors.

Yelp Company Profile

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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