Yelp (NYSE:YELP) & Trivago N.V. ADS (NASDAQ:TRVG) Critical Contrast

Trivago N.V. ADS (NASDAQ:TRVG) and Yelp (NYSE:YELP) are both small-cap communication services companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, dividends, valuation, institutional ownership, analyst recommendations, earnings and risk.

Earnings and Valuation

This table compares Trivago N.V. ADS and Yelp”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Trivago N.V. ADS	$620.90 million	0.66	$12.69 million	$0.06	96.18
Yelp	$1.46 billion	0.67	$145.60 million	$2.09	8.69

Yelp has higher revenue and earnings than Trivago N.V. ADS. Yelp is trading at a lower price-to-earnings ratio than Trivago N.V. ADS, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Trivago N.V. ADS and Yelp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Trivago N.V. ADS	2.19%	7.76%	4.23%
Yelp	8.59%	19.52%	13.44%

Risk & Volatility

Trivago N.V. ADS has a beta of 0.98, suggesting that its share price is 2% less volatile than the S&P 500. Comparatively, Yelp has a beta of 0.43, suggesting that its share price is 57% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings for Trivago N.V. ADS and Yelp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Trivago N.V. ADS	0	6	1	1	2.38
Yelp	3	3	1	0	1.71

Trivago N.V. ADS currently has a consensus price target of $5.57, indicating a potential downside of 3.48%. Yelp has a consensus price target of $26.57, indicating a potential upside of 46.32%. Given Yelp’s higher possible upside, analysts clearly believe Yelp is more favorable than Trivago N.V. ADS.

Insider and Institutional Ownership

4.5% of Trivago N.V. ADS shares are held by institutional investors. Comparatively, 90.1% of Yelp shares are held by institutional investors. 6.5% of Trivago N.V. ADS shares are held by insiders. Comparatively, 8.3% of Yelp shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Yelp beats Trivago N.V. ADS on 10 of the 14 factors compared between the two stocks.

About Trivago N.V. ADS

trivago N.V., together with its subsidiaries, operates a hotel and accommodation search platform in the United States, Germany, the United Kingdom, Canada, Japan, and internationally. It offers an online meta-search for hotels and accommodation through online travel agencies, hotel chains, and independent hotels. The company provides travel search for different types of accommodations, such as hotels, vacation rentals, and apartments; and enable advertiser access through website and apps. In addition, it offers access to its platform through various localized websites and apps in various languages. The company was incorporated in 2005 and is headquartered in Düsseldorf, Germany. trivago N.V. operates as a subsidiary of Expedia Lodging Partner Services Sarl.

About Yelp

Yelp Inc. operates a platform that connects consumers with local businesses in the United States and internationally. The company's platform covers various categories, including restaurants, shopping, beauty and fitness, health, and other categories, as well as home, local, auto, professional, pets, events, real estate, and financial services. It provides free and paid advertising products to businesses, which include cost-per-click advertising and multi-location Ad products, as well as enables businesses to deliver targeted advertising to large and high-intent audience; and business listing page products. The company also offers other services comprising Yelp Guest Manager, a subscription-based suite of front-of-house management tools for restaurants, nightlife and certain other venues, which include online reservations, a waitlist management solution that allows consumers to check wait times and join waitlists remotely, as well as through hostless kiosks, and seating and server rotation management tools; Yelp Knowledge program that offers business owners local analytics and insights through access to its historical data and other proprietary content; and Yelp Fusion, which offers free access to various basic information through publicly available APIs, and paid access to content and data for consumer-facing enterprise use. In addition, it provides content licensing, as well as allows third-party data providers to update and manage business listing information on behalf of businesses. Further, the company offers its products directly through its sales force; indirectly through partners; and online through its website and business app, as well as non-advertising partner arrangements. It has partnership with Grubhub for providing consumers with a service to place food orders for pickup and delivery. The company was incorporated in 2004 and is based in San Francisco, California.