Yelp (YELP) PT Raised to $35 at Credit Suisse as Active Advertisers Return

Credit Suisse analyst Stephen Ju raised the price target on Yelp (NYSE: YELP) to $35.00 (from $34.00) after the company reported 3Q20 revenue of $221M vs. consensus of $203M. The highlight this quarter was the sequential improvement in active advertisers (+130k QOQ) as multi-location advertisers resumed their ad budgets after a pause during 2Q20. Yelp also benefited from relative resilience within its Home & Local services business (+20%QOQ), in addition to growing contribution from its self-serve channel (low-double digits growth YOY), and a partial recovery within its Restaurants vertical (doubling QOQ).

The analyst reiterated an Outperform rating, stating "while YELP is actively ramping its multi-location national and mid-market sales force following the recent restructuring program during the early stages of the healthcrisis, management did highlight that it anticipates maintaining its local sales headcount relatively constant in the near-term. This highlights Yelp’s efforts to drive incremental revenue towards its more efficient self-serve channel, which we view as a net positive for margins longer-term."

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