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

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 lower today making it today's featured Internet laggard. The industry as a whole closed the day up 2.5%. By the end of trading, Opentable fell $0.96 (-1.7%) to $55.20 on average volume. Throughout the day, 882,482 shares of Opentable exchanged hands as compared to its average daily volume of 690,700 shares. The stock ranged in price between $54.65-$57.08 after having opened the day at $57.02 as compared to the previous trading day's close of $56.16. Other companies within the Internet industry that declined today were: Zynga Inc Class A ( ZNGA), down 6.5%, Friendfinder Networks ( FFN), down 6.1%, LookSmart ( LOOK), down 5.8% and Blucora ( BCOR), down 3.8%.
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OpenTable, Inc. provides restaurant reservation solutions primarily 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 $1.3 billion and is part of the technology sector. The company has a P/E ratio of 55.6, above the S&P 500 P/E ratio of 17.7. Shares are up 17.4% year to date as of the close of trading on Wednesday.

TheStreet Ratings rates Opentable as a buy. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, robust revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

On the positive front, Deltathree ( DDDC), down 42.9%, Angie's List ( ANGI), down 28.9%, ChinaNet Online Holdings ( CNET), down 22.8% and Akamai Technologies ( AKAM), down 17.7% , were all gainers within the internet industry with Baidu ( BIDU) being today's featured internet industry leader.

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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