At nearly $900 million, Yelp will start trading at ten times revenue. Conversely, Google trades at six times trailing-twelve-month revenue and is highly profitable. Even Groupon (GRPN - Get Report), which came under criticism for its accounting-methods and low barrier to entry, trades at six times trailing-twelve-month revenue. "Yelp is selling at the highest multiple to sales to its competitors, which is a serious metric that has to be looked at," Sweet said on the phone. "Yelp is selling at nearly double what Google is."
Yelp was competing with Groupon in the "daily-deals" space, but left that market in 2011, along with Facebook, as revenue growth slowed.
Yelp priced its IPO last night at $15 per share, above the expected $12-$14 range, indicating the high interest in the offering. 7.15 million shares will be sold in the offering, raising $107 million. It will trade under the ticker symbol "YELP" on the New York Stock Exchange.Yelp shares opened for trade at $22.00 per share, and are currently trading at $24.64, up 64.27% from their IPO price.
-- Written by Chris Ciaccia in New York >To follow the writer on Twitter, go to http://twitter.com/commodity_bull. >To submit a news tip, send an email to: firstname.lastname@example.org