Don't overlook YELP INC (NYSE:YELP)—it's a hidden gem with strong fundamentals and an attractive price tag.

Discover YELP INC (NYSE:YELP)—an undervalued stock our stock screener has picked out. YELP demonstrates solid fundamentals, including health and profitability, all while staying attractively priced. Let's explore the details.

Valuation Insights: YELP

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. YELP has earned a 7 for valuation:

• Based on the Price/Earnings ratio, YELP is valued a bit cheaper than the industry average as 72.86% of the companies are valued more expensively.
• YELP is valuated rather cheaply when we compare the Price/Earnings ratio to 23.99, which is the current average of the S&P500 Index.
• Compared to the rest of the industry, the Price/Forward Earnings ratio of YELP indicates a somewhat cheap valuation: YELP is cheaper than 77.14% of the companies listed in the same industry.
• YELP is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 20.35, which is the current average of the S&P500 Index.
• Based on the Enterprise Value to EBITDA ratio, YELP is valued a bit cheaper than 80.00% of the companies in the same industry.
• Based on the Price/Free Cash Flow ratio, YELP is valued cheaper than 81.43% of the companies in the same industry.
• YELP's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• YELP has an outstanding profitability rating, which may justify a higher PE ratio.
• A more expensive valuation may be justified as YELP's earnings are expected to grow with 14.29% in the coming years.

Profitability Insights: YELP

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of YELP, the assigned 8 is noteworthy for profitability:

• YELP has a Return On Assets of 13.51%. This is amongst the best in the industry. YELP outperforms 90.00% of its industry peers.
• YELP has a Return On Equity of 17.86%. This is amongst the best in the industry. YELP outperforms 90.00% of its industry peers.
• Looking at the Return On Invested Capital, with a value of 15.94%, YELP belongs to the top of the industry, outperforming 88.57% of the companies in the same industry.
• The 3 year average ROIC (11.39%) for YELP is below the current ROIC(15.94%), indicating increased profibility in the last year.
• With a decent Profit Margin value of 9.41%, YELP is doing good in the industry, outperforming 80.00% of the companies in the same industry.
• YELP's Profit Margin has improved in the last couple of years.
• With a decent Operating Margin value of 11.21%, YELP is doing good in the industry, outperforming 77.14% of the companies in the same industry.
• In the last couple of years the Operating Margin of YELP has grown nicely.
• Looking at the Gross Margin, with a value of 91.24%, YELP belongs to the top of the industry, outperforming 91.43% of the companies in the same industry.

Looking at the Health

ChartMill utilizes a Health Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of liquidity and solvency ratios, both in absolute terms and in comparison to industry peers. YELP has earned a 9 out of 10:

• YELP has an Altman-Z score of 6.37. This indicates that YELP is financially healthy and has little risk of bankruptcy at the moment.
• YELP has a Altman-Z score of 6.37. This is amongst the best in the industry. YELP outperforms 84.29% of its industry peers.
• There is no outstanding debt for YELP. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
• YELP has a Current Ratio of 3.34. This indicates that YELP is financially healthy and has no problem in meeting its short term obligations.
• YELP's Current ratio of 3.34 is fine compared to the rest of the industry. YELP outperforms 71.43% of its industry peers.
• YELP has a Quick Ratio of 3.34. This indicates that YELP is financially healthy and has no problem in meeting its short term obligations.
• YELP has a better Quick ratio (3.34) than 71.43% of its industry peers.

Growth Analysis for YELP

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. YELP has achieved a 5 out of 10:

• YELP shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 42.22%, which is quite impressive.
• The Earnings Per Share has been growing by 24.97% on average over the past years. This is a very strong growth
• The Earnings Per Share is expected to grow by 18.17% on average over the next years. This is quite good.

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Check the latest full fundamental report of YELP for a complete fundamental analysis.

Disclaimer

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.