Yelp is a high-quality local advertising platform with a 9-out-of-9 Piotroski F-Score, 203% free cash flow conversion, and one of the lowest forward P/E ratios in its peer group at 5.3x, but 95% revenue concentration in advertising, 25% short interest, and a confirmed death-cross downtrend keep the risk-reward unfavorable for new entry at current levels.
Thesis pillars
- Advertising Concentration Platform Risk↑Improving
- 25pct Short Interest Quality Squeeze Setup↑Improving
- Death Cross Negative Momentum↓Deteriorating
- +1 more pillar — see the Why tab for full reasoning
Pillars as of Jul 3, 2026, based on the 10-K filed Feb 27, 2026
Yelp Inc. (YELP) Stock Analysis
Recovery setup · Inst Constrain edge
Communication Services · Internet Content & Information
Sell if holding. At $18.42, A.R:R 1.2:1 is below the 1.5:1 minimum. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Concentration risk — Product: advertising revenue (95.0%); Sector modifier (Communication Services): -0.8.
Yelp operates a U.S.-focused consumer review platform connecting users with local businesses across more than 300 million ratings and reviews. Advertising represented 95% of total revenue in 2025, sourced from CPC ads, business page upgrades, and multi-location campaigns. The... Read more
Sell if holding. At $18.42, A.R:R 1.2:1 is below the 1.5:1 minimum. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Concentration risk — Product: advertising revenue (95.0%); Sector modifier (Communication Services): -0.8. Chart setup: Death cross but MACD improving, RSI 44. Score 6.1/10, moderate confidence.
Passes 4/9 gates (clean insider activity, news events none recent, semi cycle peak clear, materials cycle peak clear). Fails on weak momentum and favorable risk/reward ratio and death cross (50MA < 200MA) and earnings proximity 7d<=7d. Suitability: speculative.
About Yelp Inc.
About Yelp Inc.
Yelp's local advertising platform produced record annual revenue in 2025, with advertising contributing 95% of total revenue through CPC-priced auctions and direct multi-location campaigns. The company's review archive surpasses 300 million ratings across local business categories, accumulated since Yelp's founding more than 20 years ago. The platform is primarily U.S.-focused, serving consumers searching for local businesses across a broad range of categories.
Yelp earns through three primary sales channels: a Local sales team responsible for businesses with fewer than 10 locations (historically the largest advertising revenue share, now nearly half), a Self-serve platform where businesses buy CPC ads and page upgrades directly, and a Multi-location channel targeting businesses with 10 or more locations. Advertising is priced through an automated auction that weighs advertiser budgets against predicted consumer traffic and relevance signals. Subscription and data-licensing products — including Yelp Guest Manager for restaurants and data licensing to partners such as Sprinklr and Chatmeter — generate the remaining 5% of revenue. Transaction revenue flows primarily through the DoorDash partnership, the largest by both transaction volume and revenue per the 10-K. Google is identified as the most significant source of traffic to the platform, and Meta is separately named as a competitor with the financial resources to gain local advertising share.
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Yelp's dependence on Google as its most significant traffic source represents an asymmetric structural risk: algorithm changes and Google's promotion of its own local products have already reduced Yelp link prominence, and AI-generated search responses placed above organic results may further weigh on traffic in 2026. Advertising revenue from the Restaurants, Retail & Other category declined 6% year over year in 2025, and paying advertising locations in RR&O fell 3%, driven by the challenging macro environment those businesses face. With 95% of total revenue tied to advertiser activity, platform-level traffic erosion and category-specific spending weakness compound each other.
See also: Communication Services · Internet Content & Information
From Yelp Inc.'s most recent 10-K filing, extracted June 16, 2026.
Recent developments
updated 2026-10-29Recent Developments — Yelp Inc.
Latest news
- NEWS Yelp Host Surpasses 1 Million Calls, Expands Into Food Ordering and Adds OpenTable - AOL.com — AOL.com positive
- NEWS YELP Looks 40.9% Undervalued on GF Value™ as It Surpasses 1 Mill - GuruFocus — GuruFocus positive
- NEWS Yelp Host Surpasses 1 Million Calls with New Features - GuruFocus — GuruFocus positive
- NEWS Yelp Announces CTO Transition and Leadership Succession Plan - TipRanks — TipRanks neutral
- NEWS Yelp announces CTO Sam Eaton to step down, Alex Levy named successor - Investing.com Nigeria — Investing.com Nigeria neutral
Generated 2026-10-29T11:14:36Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- HIGHProductadvertising revenue95%10-K Item 1: 'advertising accounted for the vast majority of our revenue during the year ended December 31, 2025, contributing 95% of our revenue'
Material Events(8-K, last 90d)
- 2026-04-29Item 5.02MEDIUMSam Eaton stepped down as CTO effective June 30, 2026, after more than 13 years with Yelp. Alex Levy, SVP Engineering, appointed as successor CTO. Clean handoff.SEC filing →
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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Rating Breakdown
1 floor-breaker·1 ceiling hit
Price action weak — below key moving averages, no momentum carry. Needs a base before trend-continuation setups apply.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Sell if holding. At $18.42, A.R:R 1.2:1 is below the 1.5:1 minimum. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Concentration risk — Product: advertising revenue (95.0%); Sector modifier (Communication Services): -0.8. Chart setup: Death cross but MACD improving, RSI 44. Prior stop was $17.13. Score 6.1/10, moderate confidence.
Analyst target: $20.66 (+12.2% upside). Prior stop was $17.13. Stop-loss: $17.13.
Concentration risk — Product: advertising revenue (95.0%); Sector modifier (Communication Services): -0.8; Earnings in 7 days (event risk).
Yelp Inc. trades at a P/E of 8.9 (forward 4.8). TrendMatrix value score: 8.9/10. Verdict: Sell.
17 analysts cover YELP with a consensus score of 2.6/5. Average price target: $24.
What does Yelp Inc. do?Yelp operates a U.S.-focused consumer review platform connecting users with local businesses across more than 300...
Yelp operates a U.S.-focused consumer review platform connecting users with local businesses across more than 300 million ratings and reviews. Advertising represented 95% of total revenue in 2025, sourced from CPC ads, business page upgrades, and multi-location campaigns. The company's proprietary content is increasingly licensed to AI platforms and enterprise partners.