Skip to main content

NEW YORK (TheStreet) --Shares of Yelp (YELP) - Get Yelp Inc Report were soaring by 13.66% to $37.10 in mid-afternoon trading on Wednesday, as the company reported 2016 second-quarter earnings that beat analyst expectations. The crowd-sourced review app posted earnings of 16 cents per share on revenue of $173.4 million, exceeding earning estimates of 7 cents per share on revenue of $169.82 million.

Additionally, the company has received ratings upgrades from Raymond James, Axiom Capital, Mizuho Securities, and RBC Capital Markets. Raymond James upgraded the stock to "outperform" with a $45 price target. Axiom upgraded it to a "buy" with a $44 price target. Mizuho upgrades the stock to a "buy" as well with a $40 price target. Finally, RBC maintained its "outperform" rating and a $48 price target.

This afternoon's CNBC "Fast Money Halftime Report" panel attempted to make sense of the stock's meteoric rise today and debated whether the time has come to buy.

Co-founder of Najarian Family and Advisors Office Jon Najarian owns the stock and will continue to do so.

"We will continue to hold long positions in the name because of the positive news we received," Najarian said. 

Not so bullish on Yelp was CIO of Short Hills Capital Partners Stephen Weiss, noting he isn't buying into the metrics behind the stock's upgrade.

"I'm not a buyer, I just can't see those kinds of valuations finding a place in my portfolio based on those metrics," Weiss said.

Weiss was speaking to Raymond James seeing 40% EBITDA growth long-term to justify its $45 price target for Yelp, which he says is "not going to happen."

Scroll to Continue

TheStreet Recommends

He did however acknowledge confidence in Yelp CFO Lanny Baker, whom he described as "excellent."

Finally, chairman of O'Shares Investments and a host of CNBC's "Shark Tank," Kevin O'Leary said he isn't buying into Yelp either.

"Any stock that can move 14% in a single trading day is not an investment it's a speculation. The next time somebody changes their mind it's going down 14%, you like that kind of volatility? Not me."

Separately, TheStreet Ratings rates Yelp as a "Sell" with a ratings score of "D." This is driven by multiple weaknesses, which TheStreet Ratings believes should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks TheStreet Ratings covers.

The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow and feeble growth in its earnings per share.

TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

You can view the full analysis from the report here: YELP

Image placeholder title