Yelp Inc Dossier - Source-backed chat

Yelp Inc

YELPNYSE

SectorCommunication Services

IndustryInternet Content & Information

Beta (adjusted)0.64

Intrinsic Value $39.38median of 5 methods · middle span $33-$62based on filings through 30 Jun 2026

Market Price $18.50Price as of 30 Sep 2026

Significantly undervaluedIntrinsic value is 113% above the market price

−50% · IV below pricenear fair value ±15%IV above price · +50%

marker beyond scale (+113%)

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Market Cap $1B

Enterprise Value $909.7M

Shares Outstanding 56.1M diluted

Moat Rating Wide

Next Earnings Date5 Nov 2026

All prices and values are periodic snapshots, not live quotes. Source dates are shown for reference.

Thesis

Street consensus, scenarios, merits, risks, and invalidation triggers

AI-assisted

Thesis Summary

Yelp is undergoing a significant strategic pivot toward an AI-driven local discovery and task-completion platform, highlighted by the rollout of Yelp Assistant, Yelp Host, and its data-licensing agreement with OpenAI. While Services advertising and other revenue streams (SaaS, data licensing) show strong growth potential, the core Restaurants, Retail & Other (RR&O) advertising segment continues to face persistent macroeconomic headwinds. Near-term profitability is expected to be pressured by increased investments in AI transformation, leading to a projected decline in 2026 Adjusted EBITDA compared to 2025. Consequently, a Hold recommendation is warranted as the market monitors the execution and margin potential of Yelp's product-led AI strategy.

This section is the 12-month view: analyst targets and the probability-weighted scenarios built from them. The intrinsic value at the top of this page answers a different question: what the business is worth today.

Street view · analyst 12-month targets7 analysts · as of 18 Aug 2026

Low · most bearish analyst$21.00

Mean target$26.00

High · most bullish analyst$30.00

Our research · scenarios, merits, risks, and invalidation triggersResearch as of 18 Sep 2026

Scenarios · 12-month scenario targetsAnchored at research date

Bear CaseDownside scenario

$21.00

Persistent macroeconomic strains severely impact local business advertising budgets, causing deeper declines in paying advertiser locations. High investment costs in AI fail to yield near-term conversion improvements, resulting in margin compression and Adjusted EBITDA falling below the guided $310 million floor.

Base CaseCentral scenario

$26.00

Matches the consensus mean

Yelp executes steadily on its AI transformation, with Services advertising continuing to offset modest declines in the RR&O segment. Other revenue scales in line with management's long-term targets. 2026 Net Revenue and Adjusted EBITDA land within guided ranges of $1.455B–$1.475B and $310M–$330M, respectively, reflecting disciplined investment.

Bull CaseUpside scenario

$30.00

Rapid adoption of Yelp Assistant and Yelp Host drives substantial transaction and SaaS subscription growth, while data-licensing partnerships (e.g., OpenAI) scale faster than anticipated, leading to other revenue exceeding the $250 million run-rate target ahead of 2028. AI-driven operational efficiencies expand margins, and local advertising budgets recover strongly.

Scenarios are anchored to street consensus at the research date, with our probabilities and rationale.

Key Investment Merits

Strong growth in Services advertising revenue, which reached a record $948 million in 2025.
Rapid acceleration of other revenue streams, up 75% year-over-year in Q1 2026 to $29 million, driven by Yelp Host, Hatch, and data licensing.
Robust capital allocation program, including $292 million in share repurchases in 2025 and an additional $500 million authorization in February 2026.
Strategic partnerships, such as the data-licensing agreement with OpenAI, extending Yelp's trusted content across the AI ecosystem.

Key Investment Risks

Persistent macroeconomic headwinds pressuring local businesses, particularly in consumer-demand-sensitive categories (restaurants and retail).
Near-term margin compression due to aggressive investments in AI transformation and the integration of Hatch.
Decline in paying advertiser locations and ad clicks (ad clicks down 10% in Q1 2026).

Thesis Invalidation Triggers

Adjusted EBITDA falling below the guided range of $310 million to $330 million for the full year 2026.
A material slowdown in other revenue growth, indicating failure to scale Yelp Host, Hatch, or data-licensing initiatives.
Failure of AI features like Yelp Assistant to improve user conversion rates and advertiser returns.

All scenarios are estimates and subject to change. Past performance is not indicative of future results.

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Explore this dossier

ValuationIntrinsic value, the six-method breakdown, peer medians, and your assumptions sandbox.Financial SnapshotRevenue, profitability, returns, balance sheet, dividends, and the filing-level detail.Qualitative AnalysisBusiness overview, strategic initiatives, and mergers, acquisitions & partnerships.Outlook & Key DatesForward estimates, reporting calendar, and the monitoring framework.