Yelp: Limited Wait
Yelp remains in a tight trading range between $30 and $40.
The consumer review site is back on a reasonable path to 10+% revenue growth.
The company reduced the diluted share count by 14% over the last year.
At 3.0x EV/20 sales estimates, Yelp would trade at nearly $53 or ~50% upside.
Over the course of the year, Yelp (YELP) has been stuck in a range between $30 and $40 despite solid revenue growth mixed with large stock buybacks. These moves generate long-term value for shareholders whether the market realizes the benefits in the short term. My investment thesis remains very bullish on the stock with the chart suggesting a resolution to this tight trading range in the near term.
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Disclosure: Long YELP. Please review the disclaimer page for more details.