Yelp Beneish M Score

YELP
 Stock
  

USD 30.23  0.53  1.72%   

This module uses fundamental data of Yelp to approximate the value of its Beneish M Score. Yelp M Score tells investors if the company management is likely to be manipulating earnings. The score is calculated using eight financial indicators that are adjusted by a specific multiplier. Please note, the M Score is a probabilistic model and cannot detect companies that manipulate their earnings with 100% accuracy. Check out Yelp Piotroski F Score and Yelp Altman Z Score analysis.
  
As of 5th of December 2022, Debt to Equity Ratio is likely to grow to 0.09, while Issuance Repayment of Debt Securities is likely to drop (1.3 M). Yelp Return on Investment is very stable at the moment as compared to the past year. Yelp reported last year Return on Investment of 3.92. As of 5th of December 2022, Cash Flow Per Share is likely to grow to 3.18, while Enterprise Value over EBIT is likely to drop (91.28) .
At this time, it appears that Yelp Inc is an unlikely manipulator. The earnings manipulation may begin if Yelp's top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by Yelp executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of Yelp's earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
-3.36
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables1.0Focus
Asset Quality0.58Focus
Expense Coverage1.0Focus
Gross Margin Strengs0.95Focus
Accruals Factor1.0Focus
Depreciation Resistance1.0Focus
Net Sales Growth1.08Focus
Financial Leverage ConditionN/AFocus

Yelp Beneish M-Score Indicator Trends

The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if Yelp's auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
Current ValueLast YearChange From Last Year 10 Year Trend
Selling General and Administrative Expense371.6 M344.4 M
Significantly Up
Increasing
Slightly volatile
Revenues1.1 BB
Significantly Up
Increasing
Slightly volatile
Trade and Non Trade Receivables51.2 M47.5 M
Significantly Up
Increasing
Slightly volatile
Property Plant and Equipment Net78.1 M72.4 M
Significantly Up
Increasing
Slightly volatile
Operating Income34 M31.5 M
Significantly Up
Increasing
Slightly volatile
Net Cash Flow from Operations229.4 M212.7 M
Significantly Up
Increasing
Slightly volatile
Liabilities Non Current11.7 M10.8 M
Significantly Up
Increasing
Slightly volatile
Current Liabilities177 M164 M
Significantly Up
Increasing
Slightly volatile
Total Liabilities322.8 M299.2 M
Significantly Up
Increasing
Slightly volatile
Investments Non Current34.5 M34.8 M
Slightly Down
Decreasing
Slightly volatile
Investments Current161.3 M179.3 M
Moderately Down
Increasing
Slightly volatile
Investments169.4 M179.3 M
Notably Down
Increasing
Slightly volatile
Gross Margin87.792.4313
Notably Down
Decreasing
Slightly volatile
Depreciation Amortization and Accretion28.7 M26.6 M
Significantly Up
Increasing
Slightly volatile
Assets Non Current303.1 M280.9 M
Significantly Up
Increasing
Slightly volatile
Current Assets538.8 M644.7 M
Fairly Down
Increasing
Slightly volatile
Total Assets859.1 M1.1 B
Significantly Down
Increasing
Slightly volatile

Yelp Inc Beneish M-Score Driver Matrix

One of the toughest challenges investors face today is learning how to quickly synthesize historical financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between Yelp's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Yelp in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Yelp's degree of accounting gimmicks and manipulations.

About Yelp Beneish M Score

M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.

Depreciation Amortization and Accretion

28.75 Million

Yelp Depreciation Amortization and Accretion is very stable at the moment as compared to the past year. Yelp reported last year Depreciation Amortization and Accretion of 26.64 Million

Yelp Earnings Manipulation Drivers

Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as Yelp. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
201720182019202020212022 (projected)
Revenues846.81 M942.77 M1.01 B872.93 M1.03 B1.11 B
Total Assets1.22 B1.18 B1.07 B1.15 B1.05 B859.12 M
Current Assets913.09 M860.27 M533.31 M712.73 M644.68 M538.78 M
Total Liabilities116.9 M100.05 M315.71 M300.41 M299.21 M322.83 M
Current Liabilities86.17 M64.91 M134.16 M143.03 M164.01 M176.96 M
Operating Income14.71 M25.9 M35.51 M(38.8 M)31.51 M34 M
Net Cash Flow from Operations167.65 M160.19 M204.78 M176.7 M212.66 M229.44 M
Gross Margin91.6793.8693.8593.4592.4387.7

About Yelp Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Yelp Inc's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Yelp using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Yelp Inc based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.
Yelp Inc. operates a platform that connects consumers with local businesses in the United States and internationally. Yelp Inc. was incorporated in 2004 and is headquartered in San Francisco, California. Yelp operates under Internet Content Information classification in the United States and is traded on New York Stock Exchange. It employs 4400 people.

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Check out Yelp Piotroski F Score and Yelp Altman Z Score analysis. You can also try Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.

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Is Yelp's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Yelp. If investors know Yelp will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Yelp listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth YOY
(0.44) 
Market Capitalization
2.1 B
Quarterly Revenue Growth YOY
0.15
Return On Assets
0.0326
Return On Equity
0.0531
The market value of Yelp Inc is measured differently than its book value, which is the value of Yelp that is recorded on the company's balance sheet. Investors also form their own opinion of Yelp's value that differs from its market value or its book value, called intrinsic value, which is Yelp's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Yelp's market value can be influenced by many factors that don't directly affect Yelp's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Yelp's value and its price as these two are different measures arrived at by different means. Investors typically determine Yelp value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Yelp's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.