Yelp Stock Infographic: Is It One or Five Stars?

Yelp's stock price has taken a hit recently. Is it time to buy? Check out this infographic to find out.

May 19, 2014 at 10:05AM

The business review site Yelp (NYSE:YELP) has had a rough past three months, with its stock price down nearly 40%. With such a decline in value, you might wonder if it's time to buy into a site that seems to have trending concepts like local, mobile, and online advertising behind it. To help discover that answer, check out the below infographic and the following discussion on whether Yelp is a buy or sell.


Source: Yelp 10-Ks and 10-Qs.

Mobile threat
Yelp maintains a strong mobile presence, with mobile users growing over 50% in the first quarter of 2014 versus the first quarter of 2013. As mobile use increases, Yelp's free application can continue to grow its audience and expand functionality for both businesses and users. For example, Yelp just released a new service for small businesses to book reservations, outside of its more complete SeatMe service or through the OpenTable (NASDAQ:OPEN) integration. OpenTable's stock suffered after Yelp announced this new service, but Yelp and OpenTable's 600 other partners only contribute between 5% and 10% of North American online reservations with the majority coming from restaurant websites and OpenTable's own sites and applications.

Don't shoot the messenger
Reviews on Yelp have been proven to sway consumer preferences. Unfortunately for some businesses, they have swayed customers toward a competitor. Yelp maintains that it's completely impartial, only removing reviews that it deems fraudulent with its algorithm, but many businesses regularly complain about questionable practices if they decide not to advertise with Yelp. Yelp has even created a webpage to simply explain that an advertiser only buys an advertisement, and not manipulated reviews.

Even if it's just a case of businesses taking up a fight with Yelp rather than the displeased customers, it's unlikely Yelp will be able to completely clear its name. But as a positive sign for the company, the proportion of businesses buying advertising has risen to 4.6% out of the total businesses that have been "claimed" by the business owners. This is up from 4.1% last year.

Buy or sell Yelp
Overall, Yelp still has yet to post a profit and has ramped up marketing costs to push revenue, but the company can afford this with $400 million in cash and little debt. It does have a strong brand with a growing audience of both users and advertisers, even though growth seemingly has not been as fast as some stockholders desired. As Yelp ropes in more businesses, continues to work to shed its somewhat tainted image, and becomes the go-to site for consumers looking to spend money, the long-term prospects look solid.

The biggest thing to come out of Silicon Valley in years
If you thought the iPod, the iPhone, and the iPad were amazing, just wait until you see this. One hundred of Apple's top engineers are busy building one in a secret lab. And an ABI Research report predicts 485 million of them could be sold over the next decade. But you can invest in it right now... for just a fraction of the price of AAPL stock. Click here to get the full story in this eye-opening new report.

Dan Newman has no position in any stocks mentioned. The Motley Fool recommends OpenTable and Yelp. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.


Compare Brokers