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Should You Get Rid of Yelp Inc. (YELP) Now?

Similar to wise buying decisions, exiting certain underperformers at the right time helps maximize portfolio returns. Selling off losers can be difficult, but if both the share price and estimates are falling, it could be time to get rid of the security before more losses hit your portfolio.

One such stock that you may want to consider dropping is Yelp Inc. ( YELP ), which has witnessed a significant price decline in the past four weeks, and it has seen negative earnings estimate revisions for the current quarter and the current year. A Zacks Rank #4 (Sell) further confirms weakness in YELP.

A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen 4 estimates moving down in the past 60 days, compared to no upward revision, with estimates widening from a loss of 11 cents per share two months ago to its current level of a loss of 16 cents per share.

Also, for the current quarter, Yelp Inc. has seen 2 downward estimate revisions versus no revision in the opposite direction, dragging the consensus estimate down to a loss of 9 cents a share from a loss of 8 cents per share over the past 60 days.

The stock also has seen some pretty dismal trading lately, as the share price has dropped 11.9% in the past month.

So it may not be a good decision to keep this stock in your portfolio anymore, at least if you don't have a long time horizon to wait.

If you are still interested in the Internet Content industry, you may instead consider a better-ranked stock - Shutterfly, Inc. ( SFLY ). The stock currently holds a Zacks Rank #1 (Strong Buy) and may be better selection at this time.

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YELP INC (YELP): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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