Opentable Inc. (OPEN): Today's Featured Internet Winner

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Opentable ( OPEN) pushed the Internet industry higher today making it today's featured internet winner. The industry as a whole closed the day up 0.5%. By the end of trading, Opentable rose 46 cents (1%) to $46.61 on light volume. Throughout the day, 484,984 shares of Opentable exchanged hands as compared to its average daily volume of 744,100 shares. The stock ranged in a price between $45.63-$47.02 after having opened the day at $47.02 as compared to the previous trading day's close of $46.15. Other companies within the Internet industry that increased today were: support.com ( SPRT), up 18.1%, Zynga Inc Class A ( ZNGA), up 12.3%, Rediff.com India ( REDF), up 10.2%, and Commtouch Software ( CTCH), up 9.4%.
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OpenTable, Inc. provides restaurant reservation solutions in the United States, Canada, Germany, Japan, Mexico, and the United Kingdom. It offers solutions that form an online network connecting reservation-taking restaurants and people who dine at those restaurants. Opentable has a market cap of $1.05 billion and is part of the technology sector. The company has a P/E ratio of 50.9, above the average internet industry P/E ratio of 50.3 and above the S&P 500 P/E ratio of 17.7. Shares are up 18.3% year to date as of the close of trading on Wednesday. Currently there are three analysts that rate Opentable a buy, one analyst rates it a sell, and six rate it a hold.

TheStreet Ratings rates Opentable as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the internet industry could consider First Trust Dow Jones Internet Idx ( FDN) while those bearish on the internet industry could consider ProShares Ultra Short Technology ( REW).

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