YELP

Yelp Inc

TMT


Presented:06/02/2016
Price:$26.52
Cap:$2.01B
Current Price:$34.90
Cap:$2.34B

Presented

Date06/02/2016
Price$26.52
Market Cap$2.01B
Ent Value$1.13B
P/E RatioN/A
Book Value$9.17
Div Yield0%
Shares O/S75.88M
Ave Daily Vol2,306,319
Short Int18.15%

Current

Price$34.90
Market Cap$2.34B
Yelp, Inc. hosts an online database of user-generated reviews of local businesses. It provides reviews on local businesses, which include restaurants, boutiques and salons, dentists, mechanics and plumbers. The company provides multiple free and paid advertising solutions to engage with consumers, including free online business accounts, search advertising and Yelp Deals. Yelp was founded in September 3, 2004 by Jeremy Stoppelman and Russ Simmons and is headquartered in San Francisco, CA.

Publicly traded companies mentioned herein: Alphabet Inc (GOOG), Facebook Inc (FB), Pandora Media Inc (P), TripAdvisor Inc (TRIP), Yelp Inc (YELP)

Highlights

The presenter is long shares of local business reviews company Yelp (YELP) and said, “For the first time in a while it looks like all of the ‘model drivers’ are going in the right direction”. The weakness seen over the past year - YELP is down ~45% TTM - has created an attractive entry point. Sales force issues and the transition from a CPM-based model (cost per thousand impressions) to CPC (cost per click) are in the past, and the CPC-based rate card appears to be having a genuine impact on top line. He sees the company growing at a mid-30%s run-rate with its local model, which compares favorably to the Street’s mid-20%s estimate. In addition, the presenter sees a margin expansion opportunity and thinks new CFO Charles “Lanny” Baker is likely to continue to provide conservative guidance.

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Idea Discussion

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