Out Fox The $treet

This idea was discussed in more depth with members of my private investing community, Out Fox The Street.  Learn More »   Update - Dec. 20 Pretty absurd downgrade of Yelp. The stock is basically being given away below $30 and JPMorgan doesn't want it. The stock has actually hit a new 52-week low on the news.  -Yelp downgraded to Underweight from Neutral at JPMorgan -JPMorgan analyst Cory Carpenter downgraded Yelp to Underweight from Neutral with a price target of $23, down from $34. The insurance lead generation sector is the analyst's favorite across small and mid-cap internet stocks for 2023. He downgraded Ziff Davis to Neutral and Yelp to Underweight citing a cautious view of online advertising. Trends in online advertising are unlikely to improve at least through the first half of 2023, Carpenter tells investors in a research note. Original article published on Nov. 4 Yelp reported a strong Q3'22 with revenues growing 15% YoY. The consumer review site cut Q4 targets d...

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. Read the full article at Seeking Alpha.  Disclosure: Long YELP. Please review the disclaimer page for more details. 

For the last year,  Yelp (YELP)  has been stuck in a range of $30 to $40. The stock is stuck in this range despite an extreme valuation position in the low $30s. The stock has an EV of only $2.0B with '20 revenue estimates of $1.1B and adjusted EBITDA in the $250 million range.  Investors should jump on this stock on another dip to $32 or a rip above the slopping downtrend right around $36 now.  Disclosure: Long YELP. Please read the disclaimer page for more details. 

Yelp reported a solid Q2 despite the revenue miss. The company repurchased 8.8 million shares in the quarter, leading to a nearly 12% share count reduction YoY. The stock is cheap trading at 9x EV/EBITDA estimates while the EBITDA/share grew by 50%. While the market has constantly hyperventilated on the revenue growth of  Yelp  ( YELP ), the consumer review site has quietly become a money machine. The company has utilized expense control to generate large cash flows to substantially reduce share counts in a huge benefit to shareholders. The market will slowly catch on to the bullish cash flow story for a company growing revenues up to 10% annually. Read the full article on Seeking Alpha.  More commentary - Out Fox The $treet - August 13 Disclosure: Long YELP. Please read the disclaimer page for more details. 

After the close,  Yelp (YELP) reported Q4 numbers that beat estimates. In addition, the company established these 2023 goals.

Despite the weakness today, Yelp ( YELP ) is still above the lows following the disastrous Q3 report. The stock is down to $34 following a downgrade to Underweight from Morgan Stanley. The analyst sees issues with paying accounts, but the consumer review site already took steps to rectify the issue in the last quarter.

Yelp slumps 30% on a typical sales hiccup. The consumer review site saw key metrics grow about 20% YoY. The stock has historically rebounded following these quarterly problems as the stock bounces off trough P/S multiples. Yelp   ( YELP ) never seems to fail to rip failure out of the hands of success. The consumer review site always follows strong quarters with unexpected issues. The stock has historically been a buy on these dips as the key consumer metrics constantly expand in the 20% range. Read the full article on Seeking Alpha.  Disclosure: Long Yelp. Please review the disclaimer page for more details.