This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Yelp Drops as Secondary Offering Weighs

Updated from 4:16 p.m. to include updated share price and news of secondary offering.

NEW YORK (TheStreet) -- Yelp (YELP - Get Report) shares fell 5.4% to $65.10 despite third-quarter revenue that beat Wall Street estimates, and the company raising 2013 revenue guidance. The company also announced it would be doing a secondary offering, as it seeks to bolster its balance sheet.

The San Francisco-based online urban city guide reported a loss of 4 cents a share on $61.2 million in revenue, as revenue grew 68% year over year. Analysts surveyed by Thomson Reuters were expecting a gain of 3 cents per share on $59.41 million in revenue.

During the quarter, Yelp noted average monthly unique visitors grew 41% year over year to approximately 117 million, and active local business accounts grew 61% to approximately 57,200.

"We saw another quarter of strong momentum thanks to the high-quality, authentic content contributed by Yelpers around the world," said Jeremy Stoppelman, Yelp's CEO, in the company's press release.  "Our focus on connecting consumers with great local businesses continues to drive our success.  In the third quarter, we improved the user experience by adding the ability to write and post reviews from mobile and launched new features such as the customer activity feed for business owners.  Looking to the rest of the year and beyond, we are well positioned to capture the large local opportunity ahead of us through our innovation around mobile, geographic expansion and closing the loop with local businesses."

During the quarter, the company noted that approximately 46% of ads were shown on mobile devices, with approximately 62% of the searches coming from mobile devices.

Yelp gave fourth-quarter guidance, saying it expects net revenue between $66 million and $67 million, with adjusted EBIDTA between $9 million and $10 million.  Analysts surveyed by Thomson Reuters are expecting Yelp to post revenue of $64.8 million during the fourth quarter.

The company also raised its 2013 revenue guidance.  It now expects revenue between $228 million and $229 million, with adjusted EBITDA is expected to be in the range of $28 million to $29 million.

Yelp also announced it would be doing a secondary offering, selling approximately $250 million in Class A common stock. Yelp will grant the underwriters an option to purchase an additional $37.5 million in shares. The company said the proceeds of the offering would be for additional working capital and general corporate purposes, as well as acquisitions.

Goldman Sachs, Citigroup, and Jefferies will be bookrunning managers for the offering.  Oppenheimer and Cowen and will be co-managers for the offering.

Must Read: Apple's 'iPad Christmas' Promises Share Upside

Shares closed the regular session higher, gaining 1.8% to close at $68.81.

--Written by Chris Ciaccia in New York

>Contact by Email.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
YELP $21.51 2.43%
AAPL $93.64 -0.11%
FB $118.57 0.84%
GOOG $698.21 0.75%
TSLA $241.80 0.43%


Chart of I:DJI
DOW 17,891.16 +117.52 0.66%
S&P 500 2,081.43 +16.13 0.78%
NASDAQ 4,817.5940 +42.2360 0.88%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs