Yelp (YELP) Cut to “Hold” at Zacks Investment Research

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Yelp (NYSE:YELP) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a research report issued to clients and investors on Tuesday.

According to Zacks, “Yelp reported solid second-quarter results driven by growth in ad revenues. Yelp is benefiting from rising advertisements on the platform. The company’s shift toward selling advertising plans without any fixed duration is leading to a robust increase in paying advertiser accounts. The collaboration with GrubHub is a tailwind for Yelp as it provides users with access to a significant number of restaurants available for food ordering on the platform. Besides, the company is witnessing acceleration in consumer traffic across app unique devices. Significant improvement in cumulative reviews is also encouraging. Shares have outperformed the industry on a year-to-date basis. However, increase in operating expenses driven by an expected increase in headcount, product development and sales & marketing expenses will remain an overhang on the bottom line. Stringent competition from search giants like Google and Bing is a big threat.”

Several other brokerages also recently weighed in on YELP. Barclays raised their price target on shares of Yelp from $47.00 to $48.00 and gave the company an “equal weight” rating in a research report on Thursday, August 9th. JPMorgan Chase & Co. raised their price target on shares of Yelp to $57.00 and gave the company an “overweight” rating in a research report on Thursday, August 9th. KeyCorp reissued a “hold” rating on shares of Yelp in a research report on Thursday, August 9th. Jefferies Financial Group raised their price target on shares of Yelp from $53.00 to $55.00 and gave the company a “buy” rating in a research report on Thursday, August 9th. Finally, Robert W. Baird raised their price target on shares of Yelp from $44.00 to $45.00 and gave the company a “neutral” rating in a research report on Thursday, August 9th. Three equities research analysts have rated the stock with a sell rating, thirteen have issued a hold rating and ten have issued a buy rating to the company’s stock. The stock has a consensus rating of “Hold” and a consensus target price of $48.17.

Shares of NYSE YELP traded up $0.11 on Tuesday, reaching $44.85. 75,143 shares of the company’s stock traded hands, compared to its average volume of 4,037,762. Yelp has a 12 month low of $36.42 and a 12 month high of $51.33. The company has a market capitalization of $3.79 billion, a price-to-earnings ratio of 641.43, a P/E/G ratio of 8.23 and a beta of 0.96.

Yelp (NYSE:YELP) last announced its earnings results on Wednesday, August 8th. The local business review company reported $0.12 earnings per share for the quarter, beating the Zacks’ consensus estimate of ($0.02) by $0.14. Yelp had a net margin of 17.64% and a return on equity of 0.74%. The business had revenue of $234.90 million during the quarter, compared to the consensus estimate of $232.26 million. During the same quarter last year, the firm earned $0.25 earnings per share. The business’s revenue for the quarter was up 11.9% on a year-over-year basis. research analysts forecast that Yelp will post 0.28 earnings per share for the current year.

In other news, CEO Jeremy Stoppelman sold 13,000 shares of Yelp stock in a transaction on Tuesday, August 14th. The shares were sold at an average price of $47.00, for a total transaction of $611,000.00. The sale was disclosed in a legal filing with the SEC, which is accessible through this link. Also, COO Joseph R. Nachman sold 16,303 shares of Yelp stock in a transaction on Friday, August 10th. The stock was sold at an average price of $50.00, for a total transaction of $815,150.00. Following the transaction, the chief operating officer now owns 131,734 shares in the company, valued at approximately $6,586,700. The disclosure for this sale can be found here. In the last ninety days, insiders sold 198,303 shares of company stock valued at $8,443,085. 9.00% of the stock is currently owned by insiders.

Institutional investors have recently modified their holdings of the company. Natixis purchased a new position in shares of Yelp during the 1st quarter worth $1,952,000. Soma Equity Partners LP lifted its stake in shares of Yelp by 5.4% during the 1st quarter. Soma Equity Partners LP now owns 2,200,000 shares of the local business review company’s stock valued at $91,850,000 after buying an additional 113,000 shares in the last quarter. Fine Capital Partners L.P. lifted its stake in shares of Yelp by 1.8% during the 1st quarter. Fine Capital Partners L.P. now owns 1,063,251 shares of the local business review company’s stock valued at $44,391,000 after buying an additional 18,795 shares in the last quarter. Lido Advisors LLC purchased a new position in shares of Yelp during the 1st quarter valued at $358,000. Finally, Summit Global Investments purchased a new position in shares of Yelp during the 1st quarter valued at $534,000. Institutional investors and hedge funds own 97.99% of the company’s stock.

Yelp Company Profile

Yelp Inc operates a platform that connects people with local businesses in the United States, Canada, and internationally. The company's platform covers various local business categories, including restaurants, shopping, beauty and fitness, arts, entertainment and events, home and local services, health, nightlife, travel and hotel, auto, and others.

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