Financial Analysis: Yelp (NYSE:YELP) and Opera (NASDAQ:OPRA)

Yelp (NYSE:YELP) and Opera (NASDAQ:OPRA) are both small-cap computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, analyst recommendations, dividends, institutional ownership, earnings, risk and valuation.

Valuation & Earnings

This table compares Yelp and Opera”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Yelp	$1.45 billion	1.36	$132.85 million	$2.21	14.18
Opera	$480.65 million	3.81	$80.77 million	$0.89	22.99

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

Analyst Recommendations

This is a breakdown of current ratings for Yelp and Opera, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Yelp	2	4	0	0	1.67
Opera	1	0	6	0	2.71

Yelp currently has a consensus target price of $34.00, indicating a potential upside of 8.53%. Opera has a consensus target price of $24.90, indicating a potential upside of 21.70%. Given Opera’s stronger consensus rating and higher possible upside, analysts clearly believe Opera is more favorable than Yelp.

Institutional & Insider Ownership

90.1% of Yelp shares are held by institutional investors. Comparatively, 10.2% of Opera shares are held by institutional investors. 8.0% of Yelp shares are held by company insiders. Comparatively, 84.4% of Opera shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Volatility and Risk

Yelp has a beta of 1.03, meaning that its share price is 3% more volatile than the S&P 500. Comparatively, Opera has a beta of 1.03, meaning that its share price is 3% more volatile than the S&P 500.

Profitability

This table compares Yelp and Opera’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Yelp	10.28%	20.17%	15.18%
Opera	14.53%	8.85%	7.91%

Summary

Opera beats Yelp on 7 of the 13 factors compared between the two stocks.

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.

About Opera

Opera Limited, together with its subsidiaries, provides mobile and PC web browsers and related products and services in Norway and internationally. The company offers mobile browser products, such as Opera Mini, Opera browser for Android and iOS, and Opera GX for PCs and Mobile; Opera Touch; PC browsers, including Opera for Computers and Opera GX; Apex Football; Opera VPN Pro; and Opera News, an AI-powered personalized news discovery and aggregation service. It provides Opera Crypto Browser for PCs and mobile; browser-based cashback rewards programs; owns GameMaker Studio, a 2D gaming development platform; and GXC, a gaming portal. In addition, the company operates Opera Ads, an online advertising platform; and offers Web3 and e-commerce services. Opera Limited was founded in 1995 and is headquartered in Oslo, Norway. Opera Limited is a subsidiary of Kunlun Tech Limited.