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Victor Anthony: Einhorn's Yelp Forecast A 'Stretch' To Achieve

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Yelp Inc. NYSE:YELP, Facebook, Inc. NASDAQ:FB - Victor Anthony: Einhorn's Yelp Forecast A 'Stretch' To Achieve

Greenlight Capital's David Einhorn released a letter to his fund's investors that detailed several moves in the quarter - including a new position in Yelp Inc YELP 4%.

Einhorn said in his letter Yelp is a "five stars" stock and a position was established at an average price of $21.16. The investment manager expects the company to double its sales and earn $300 million of EBITDA by 2019 if management executes on its plan.

Shares of Yelp were boosted by Einhorn's encouraging comments and were trading higher by more than 3 percent on Tuesday. However, some of Wall Street's analysts did not share a similar bullish sentiment.

Related Link: All You Need To Know From David Einhorn's Q1 Letter To Greenlight Investors

Speaking to Benzinga, Axiom Capital Management's Victor Anthony said Einhorn's longer-term outlook is a "stretch" to achieve.

Anthony pointed out that Yelp's new Chief Financial Officer, Lanny Baker, is "good" but "faces a series of challenges including rising competition, lack of meaningful growth in salesforce productivity, advertiser attrition, slowing fundamentals, and challenges exporting the business outside the U.S."

Anthony also also suggested that Yelp's attractiveness as a takeover company may have diminished. He said Alphabet Inc GOOG 0.52% and Facebook Inc FB 0.58% likely have no interest in buying the company "given that both are organically replicating the user review process."

Anthony added that maybe Priceline Group Inc PCLN 0.74% present another bid to acquire the company.

Image credit: Nan Palmero, Flickr

DateFirmActionFromTo
Mar 2016Mizuho SecuritiesInitiates Coverage onNeutral
Mar 2016UBSDowngradesNeutralSell
Feb 2016Tigress FinancialUpgradesNeutralBuy

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