Head-To-Head Survey: Care.com (CRCM) versus Yelp (YELP)
Care.com (NYSE: CRCM) and Yelp (NYSE:YELP) are both consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, profitabiliy, dividends, institutional ownership, risk and earnings.
Risk and Volatility
Care.com has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500. Comparatively, Yelp has a beta of 1.66, meaning that its share price is 66% more volatile than the S&P 500.
This table compares Care.com and Yelp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider and Institutional Ownership
72.0% of Care.com shares are owned by institutional investors. Comparatively, 90.8% of Yelp shares are owned by institutional investors. 24.7% of Care.com shares are owned by insiders. Comparatively, 11.1% of Yelp shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Earnings and Valuation
This table compares Care.com and Yelp’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Care.com||$165.85 million||2.60||$7.41 million||($0.04)||-366.91|
|Yelp||$751.78 million||3.29||$32.64 million||$0.07||438.86|
Yelp has higher revenue and earnings than Care.com. Care.com is trading at a lower price-to-earnings ratio than Yelp, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations and price targets for Care.com and Yelp, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Care.com presently has a consensus target price of $12.17, suggesting a potential downside of 17.12%. Yelp has a consensus target price of $35.00, suggesting a potential upside of 13.93%. Given Yelp’s stronger consensus rating and higher probable upside, analysts clearly believe Yelp is more favorable than Care.com.
Yelp beats Care.com on 11 of the 14 factors compared between the two stocks.
Care.com, Inc. is an online marketplace for finding and managing family care. As of December 31, 2016, the Company had 22.8 million members, including 12.9 million families and 9.9 million caregivers, spanning 19 countries. Its consumer matching solutions allow families to search for, qualify, vet, connect with and select caregivers. It also provides caregivers with solutions to create personal profiles, describe their skills and experience, and otherwise differentiate and market themselves in a fragmented marketplace. In addition to consumer matching solutions, the Company offers its members products and services to facilitate their interaction with caregivers. It serves employers by providing access to certain of its products and services to employer-sponsored families. In addition, it serves care-related businesses, such as day care centers, nanny agencies and home care agencies, willing to market their services to its care-seeking families and recruit its caregiver members.
Yelp Inc. (Yelp) connects people with local businesses by bringing ‘word of mouth’ online and providing a platform for businesses and consumers to engage and transact. The Company offers local business review sites. Yelp provides a platform for consumers to share their everyday local business experiences with other consumers by posting reviews, tips, photos and videos, and to engage directly with businesses, through reviews, its Request-A-Quote and Message the Business features, and by completing transactions on the Yelp Platform. Yelp also provides businesses of all sizes with a range of free and paid services that help them engage with consumers. The Yelp Platform allows consumers to transact with local businesses directly on Yelp through Yelp Eat24, the food ordering and delivery business; Yelp Reservations, its online reservations product, and integrations with partners ranging from Shoptiques.com (boutique shopping) to GolfNow (tee time booking) to BloomNation (flower ordering).
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