BMO just initiated coverage with an "outperform" rating
BMO just initiated coverage of online review name Yelp Inc (NYSE:YELP) with an "outperform" rating and a $45 price target -- a roughly 26% premium to last night's close. The analyst said it sees "revenue growth accelerating" in the next two years, and that the stock's recent dip -- combined with heavy investor skepticism -- provides an "attractive entry point." The shares are up 0.9% at $35.96 in response.
The analyst's note is relatively rare among the bearish-leaning brokerage bunch. BMO's price target is above the consensus 12-month target of $39.32, and as of yesterday, only four "buy" or better ratings were on the table, compared to 18 "hold" or worse ratings.
Looking at the charts, the security is still struggling to close its early November bear gap, with its most successful attempt in mid-February thwarted by its 200-day moving average. More recently, the equity has found a floor at the $34 level and its year-to-date breakeven, and is pacing for its fourth straight weekly win.
An unwinding of short interest could propel YELP higher, too. While short interest inched lower in the most recent reporting period, it still represents 15.5% of the stock's available float. At Yelp's average pace of trading, it would take almost two weeks to buy back these bearish bets.