Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Yelp (NYSE:YELP) fell as much as 10% in early trading, before settling into a roughly 5% loss in a volatile reaction to the company's underwhelming earnings report.

So what: Yelp's fourth-quarter revenue beat the Street's estimates, $41.2 million against $40.3 million. However, the company lost $0.08 per share, which was much worse than the $0.01 per share loss analysts had forecast. Yelp's first-quarter revenue guidance of $210 million to $212 million in revenue, ahead of the $207.3 million consensus, failed to assuage skittish investors worried over the quarterly loss.

Yelp reported adjusted EBITDA of $1.8 million for the quarter, which is an improvement over the year-ago quarter's narrow loss. Local revenue nearly doubled, growing 87% to $33.9 million, while no other segment posted similar increases. However, sales and marketing costs are up 59.3% year over year, and product development costs increased 97.5%. The company now expects first-quarter revenue of $44 million to $44.5 million with adjusted EBITDA of $1.3 million to $1.5 million. For the full year, the company anticipates $210 million to $212 million in revenue and adjusted EBITDA of $20 million to $22 million.

Now what: Yelp may be growing its revenue quickly, but investors aren't satisfied that the company has staked out its claim beyond the reach of potential competitors. It also happens to be very expensive based on its projections -- even if Yelp were to make every cent of adjusted EBITDA into GAAP net income, it would only wind up with a 61 P/E. This volatile stock might be fun for short-term traders, but long-term investors can probably find better options.

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