Financial Performance - 2025 net revenue reached a record of $1.46 billion, representing a 4% year-over-year increase[8] - Net income increased by 10% year over year to $146 million, achieving a net income margin of 10%[8] - Adjusted EBITDA grew by 3% year over year to $369 million, with an adjusted EBITDA margin of 25%[8] - Services advertising revenue increased by 8% year over year to a record $948 million[8] - Other revenue accelerated significantly, up 17% year over year, driven by growth in transactions, SaaS subscriptions, and data licensing[2] - Net income for the year ended December 31, 2025, increased to $145.6 million from $132.85 million in 2024, representing a growth of approximately 9.5%[16] - Adjusted EBITDA for the year ended December 31, 2025, was $357.99 million, slightly down from $369.18 million in 2024, indicating a decrease of about 3%[21] - The company reported a net revenue of $1.41 billion for the year ended December 31, 2025, down from $1.46 billion in 2024, a decrease of approximately 3.6%[21] - The net income margin for the year ended December 31, 2025, was 9%, compared to 10% in 2024, indicating a slight decline in profitability[21] - The Adjusted EBITDA margin for the year ended December 31, 2025, was 25%, consistent with the margin reported in 2024[21] Cash Flow and Financing - Free cash flow for the year ended December 31, 2025, reached $323.68 million, up from $248.47 million in 2024, reflecting an increase of approximately 30.2%[21] - Net cash provided by operating activities for the year ended December 31, 2025, was $372.03 million, compared to $285.82 million in 2024, marking a significant increase of about 30.2%[16] - Cash, cash equivalents, and restricted cash at the end of the period were $216.29 million, a slight decrease from $217.68 million at the beginning of the period[16] - The company utilized $330.05 million in financing activities during the year ended December 31, 2025, compared to $303.80 million in 2024, reflecting an increase of about 8.6%[16] - The company experienced a net cash used in investing activities of $45.65 million for the year ended December 31, 2025, an improvement from $77.27 million in 2024[16] Future Projections - The company expects 2026 net revenue to be in the range of $1.455 billion to $1.475 billion[4] - 2026 adjusted EBITDA is expected to be in the range of $310 million to $330 million[4] User Engagement - Yelp users contributed 22 million new reviews in 2025, resulting in a total of 330 million cumulative reviews, up 7% from the prior year[8] - Average revenue per location reached an annual record despite a 3% decrease in total paying advertising locations[8] Strategic Initiatives - The company is focused on AI transformation and has signed an agreement with OpenAI to enhance its services[2]

Core Viewpoint - The communication services sector has identified oversold stocks, presenting a potential buying opportunity for undervalued companies [1]. Group 1: Oversold Stocks - The Relative Strength Index (RSI) is a momentum indicator that helps assess a stock's performance by comparing its strength on up days versus down days [1]. - A stock is generally considered oversold when its RSI is below 30, indicating potential for price recovery [1]. Group 2: List of Oversold Companies - Major oversold companies in the communication services sector include Douyu International Holdings Ltd (NASDAQ:DOYU), Angi Inc (NASDAQ:ANGI), and Yelp Inc (NYSE:YELP) [2][3].

Core Viewpoint - The communication services sector has several oversold stocks that present potential buying opportunities for undervalued companies [1]. Group 1: Oversold Stocks - The Relative Strength Index (RSI) is a momentum indicator that helps assess a stock's performance by comparing its strength on up days versus down days [1]. - A stock is typically considered oversold when its RSI is below 30, indicating potential for price recovery [1]. - The latest list of major oversold stocks in the communication services sector includes Douyu International Holdings Ltd, Angi Inc, and Yelp Inc, all having an RSI near or below 30 [2][3].

Core Insights - Yelp (YELP) is expected to report quarterly earnings of $0.47 per share, a decline of 24.2% year-over-year, with revenues forecasted at $358.21 million, reflecting a 1% decrease compared to the previous year [1] - The consensus EPS estimate has remained unchanged over the last 30 days, indicating a reevaluation of initial estimates by analysts [1] Revenue Estimates - Analysts project 'Net revenue- Advertising' to reach $339.01 million, indicating a year-over-year change of -1.9% [3] - 'Net revenue- Other services' is expected to be $19.20 million, showing a significant increase of 17.7% from the prior-year quarter [4] - 'Net revenue- Advertising revenue- Services' is estimated at $231.01 million, reflecting a year-over-year change of +2.8% [4] - The consensus for 'Net revenue- Advertising revenue- Restaurants, Retail & Other' stands at $108.00 million, indicating a decline of 10.6% from the previous year [5] Advertising Metrics - 'Paying Advertising Locations' is expected to be 502.67 thousand, down from 521.00 thousand in the same quarter last year [5] - 'Paying Advertising Locations - Restaurants, Retail & Other' is projected to reach 246.00 thousand, compared to 271.00 thousand reported in the same quarter of the previous year [6] - 'Paying Advertising Locations - Services' is estimated at 256.67 thousand, slightly up from 250.00 thousand reported in the same quarter last year [6] Stock Performance - Over the past month, Yelp shares have returned -21.1%, contrasting with the Zacks S&P 500 composite's unchanged performance [6] - Yelp currently holds a Zacks Rank 2 (Buy), suggesting potential outperformance in the near future [6]

Core Insights - The Zacks Internet - Content industry is experiencing growth due to strong demand for digital offerings, video content, and cloud-based applications, aided by advancements in AI and Generative AI [1][3] - Despite growth opportunities, the industry faces challenges from macroeconomic conditions affecting advertising spending, which is a primary revenue source [1][4] Industry Description - The industry includes providers of video encoding platforms, Internet content, staffing services, and online travel companies, among others, and is undergoing rapid digitalization [2] - Advertising remains a major revenue source, prompting companies to enhance their digital presence across various platforms [2] Trends - There is a growing demand for digital offerings driven by technological advancements and the proliferation of smart devices [3] - The industry is characterized by frequent product introductions and evolving consumer behavior [3] Advertising and Revenue - Marketing efforts are focused on increasing website traffic, with advertising and subscriptions being key revenue sources [4] - Consumer spending trends, particularly during holidays, significantly influence revenue, although macroeconomic challenges are expected to impact ad spending in the near term [4] Regulatory Environment - Increased regulatory pressures, especially in China and the EU, are affecting industry participants, particularly regarding advertising practices [5] - The implementation of the General Data Protection Regulation and the Digital Markets Act in the EU adds to the challenges faced by online content providers [5] Industry Ranking - The Zacks Internet - Content industry holds a Zacks Industry Rank of 55, placing it in the top 23% of over 250 Zacks industries, indicating a generally positive outlook [6] - However, the near-term prospects are considered dim, with the industry underperforming compared to the broader market [7][10] Earnings Outlook - Analysts show optimism regarding the industry's earnings growth potential, with a 4.1% increase in the Zacks Consensus Estimate for 2026 earnings since November 30, 2025 [8] Stock Performance - The industry has underperformed the S&P 500 and the broader Zacks Computer and Technology sector over the past year, with a decline of 40.3% compared to the S&P 500's increase of 16.8% [10] Valuation - The industry is currently trading at a trailing 12-month price-to-sales ratio of 3.66X, lower than the S&P 500's 6.61X and the sector's 8.32X [13] Company Highlights - **RELX**: A Zacks Rank 1 (Strong Buy) company benefiting from a shift towards higher growth analytics and decision tools, with a steady earnings estimate of $1.95 per share for 2026 [16][17] - **Yelp**: A Zacks Rank 2 (Buy) stock experiencing growth from increased ad spending and consumer traffic, with a steady earnings estimate of $2.39 per share for 2026 [20][21]

Core Insights - Zacks Premium offers various tools for investors to enhance their stock market strategies, including daily updates, research reports, and stock screens [1] - The Zacks Style Scores provide a unique rating system for stocks based on value, growth, and momentum, helping investors identify securities with high potential for market outperformance [2] Zacks Style Scores Overview - Stocks are rated from A to F based on their value, growth, and momentum characteristics, with A being the highest score indicating a better chance of outperforming the market [3] - The Style Scores are categorized into four types: Value Score, Growth Score, Momentum Score, and VGM Score, each focusing on different investment strategies [3][4][5][6] Value Score - The Value Score targets investors looking for undervalued stocks, utilizing financial ratios like P/E, PEG, and Price/Sales to identify attractive investment opportunities [3] Growth Score - The Growth Score emphasizes a company's future earnings potential and financial health, analyzing historical and projected earnings, sales, and cash flow [4] Momentum Score - The Momentum Score is designed for traders who capitalize on price trends, using metrics like short-term price changes and earnings estimate revisions to identify high-momentum stocks [5] VGM Score - The VGM Score combines all three Style Scores, providing a comprehensive rating that helps investors find stocks with the best value, growth prospects, and momentum [6] Zacks Rank Integration - The Zacks Rank is a proprietary model that uses earnings estimate revisions to identify stocks, with 1 (Strong Buy) stocks historically yielding an average annual return of +23.9% since 1988, significantly outperforming the S&P 500 [7] - Investors are encouraged to focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B for optimal investment success [9] Stock Highlight: Yelp (YELP) - Yelp, based in San Francisco, is rated 3 (Hold) on the Zacks Rank and has a VGM Score of A, indicating potential for growth [11] - The company is projected to achieve year-over-year earnings growth of 13.3% for the current fiscal year, with a recent upward revision in earnings estimates [12] - Yelp's average earnings surprise stands at +26.8%, making it a noteworthy option for growth investors [12]

Core Insights - Yelp is enhancing its AI capabilities through the acquisition of Hatch, an AI-powered customer communication platform, for approximately $270 million in cash, with an additional $30 million for employee retention over the next two to three years [2][3]. Company Strategy - The acquisition is a significant step in Yelp's AI transformation strategy, aimed at providing advanced AI tools to local businesses [2]. - Yelp plans to utilize Hatch's lead management solutions to better support service businesses in their AI adoption [2][3]. Technology and Innovation - Hatch, founded in 2018, offers solutions that improve customer communication and retention using conversational AI agents for SMS, email, and phone interactions [4]. - Yelp has been integrating AI tools over the past few years, including new AI-powered search capabilities in 2023 and AI-driven business summaries planned for 2024 [4]. Market Trends - The acquisition aligns with a broader trend where businesses are increasingly adopting agentic AI, with a significant drop in companies merely considering AI from 52% in August to 30% by November [6]. - By November, nearly 25% of chief product officers reported either piloting or fully implementing agentic AI, a substantial increase from just 3% in August [6][7].

Core Insights - Zacks Premium offers various tools to help investors make informed decisions and invest confidently in the stock market [1][2] Zacks Style Scores - The Zacks Style Scores are indicators that assist investors in selecting stocks likely to outperform the market within 30 days, rated from A to F based on value, growth, and momentum characteristics [3] - Stocks with higher Style Scores have a better chance of outperforming the market [3] Categories of Style Scores - **Value Score**: Focuses on identifying undervalued stocks using ratios like P/E, PEG, and Price/Sales to highlight attractive investment opportunities [4] - **Growth Score**: Analyzes projected and historical earnings, sales, and cash flow to find stocks with sustainable growth potential [5] - **Momentum Score**: Utilizes price trends and earnings estimate changes to identify favorable times to invest in high-momentum stocks [6] - **VGM Score**: Combines the three Style Scores to identify stocks with the best value, growth forecasts, and momentum [7] Zacks Rank and Style Scores Interaction - The Zacks Rank, based on earnings estimate revisions, helps investors build successful portfolios, with 1 (Strong Buy) stocks yielding an average annual return of +23.81% since 1988, outperforming the S&P 500 [8] - To maximize returns, investors should target stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B [10] - Stocks with lower ranks (4 or 5) may still have good Style Scores but are likely to face downward price pressure due to negative earnings outlooks [11] Company Spotlight: Yelp (YELP) - Yelp, founded in 2004, operates as an online community providing information on various services, including restaurants and shopping [12] - Currently rated 3 (Hold) by Zacks, Yelp has a VGM Score of A and a Momentum Style Score of B, with shares up 6% in the past four weeks [12][13] - Recent earnings estimates for fiscal 2025 have been revised upward, with the Zacks Consensus Estimate increasing by $0.05 to $2.13 per share, and an average earnings surprise of +26.8% [13]

Core Insights - Mountain Mike's Pizza was ranked 7 among U.S. restaurant chains and 9 overall on Yelp's Most Loved Brands of 2025 list [1]

Group 1: Company Overview - Yelp's competitive advantage is derived from its established brand, extensive user-generated content, and the integration of value-added services for businesses and consumers [1] - The company primarily generates revenue through cost-per-click and multi-location advertising, business page products, and subscription-based services targeting local businesses across various sectors [1][2] Group 2: Financial Performance - Yelp's stock has declined by approximately 20% over the past 12 months, with total revenue growth falling to low single digits in recent quarters due to weakening advertising demand and slowing engagement metrics [8] - Advertising clicks decreased by 11% year-over-year in the third quarter, while average cost-per-click (CPC) increased by 14% during the same period [9] - Revenue from the Restaurants, Retail & Other (RR&O) segment, which constitutes one-third of total revenue, fell by 2% year-over-year, attributed to lower ad spending due to macroeconomic and competitive pressures [9] Group 3: Insider Transactions - Joseph R Nachman, COO of Yelp, sold 20,325 shares in an open-market transaction for $611,845, which represented 9.40% of his direct holdings, significantly higher than the recent median of 2.34% per sale [5][4] - This transaction was part of a systematic disposition plan following SEC's Rule 10b5-1, indicating a larger-than-typical reduction in holdings [7] Group 4: Market Conditions - The adtech business is facing challenges due to reduced spending from lower- and mid-income consumers, leading to weaker same-store sales in retail and lower dine-out traffic in restaurants [6][10] - Yelp shares are trading at 12.7 times trailing 12-month earnings and 1.4 times sales, suggesting potential undervaluation, but the growth of advertising revenue is heavily dependent on macroeconomic conditions and competition [11]