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Battle Of The Stocks: Yelp Vs GrubHub

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In this edition of Battle Of The Stocks, we look at two stocks in the online food delivery and reservation business, Yelp [YELP] and GrubHub [GRUB]. While Yelp has well over a million restaurants on its website, GrubHub is an established online ordering service.

The two companies are an online ordering platform that connects diners with restaurants. Here, we look at which stock is a better buy at current levels.

Market Cap

Driven by the massive increase in share prices, the market cap of Yelp and GrubHub have grown significantly since the start of 2016.

Shares of Yelp are trading flat this year driven by a 15% decline in Oct. 2018. The stock is however up 70% in the last 3 years and 50% in the last 18 months.

Comparatively, the GrubHub stock has gained over 250% since 2015 and 100% in the last 18 months. Despite a 36% decline in Oct., the stock is up 24% this year, easily beating returns of major indices.

This staggering climb in value resulted in billion-dollar valuations for the two companies. Yelp’s market cap is currently $3.5B while GrubHub’s market cap is higher at $8.1B.

However past returns are not an indicator of future price movements.

Revenue Growth

Revenue growth is a key indicator to gauge the financial position of any company. Any firm that can grow its revenue at a robust rate will be worth investing in.

Yelp reported sales of $844M last year and it’s estimated to rise 14% to $963M this year. Analysts expect its revenue to grow 18% to a robust $1.14B in 2019.

GrubHub, on the other hand, reported sales of $680M last year and analysts expect its revenue to grow 34% to $1.4B.

WINNER: GrubHub

Profitability

The profit margins of these online ordering portals have expanded, driven by a rise in revenue and operating efficiencies. While Yelp’s operating margin is estimated at 2.8% this year, it’s expected to be 5.4% next year.

GrubHub, however, sees the operating margin at an estimated 18.7% for the current fiscal, while it’s expected to be 18.5% next year

WINNER: GrubHub

Earnings Growth

While the two companies are looking to improve profit margins, analysts and investors are concerned over the earnings growth potential.

Analysts expect Yelp’s earnings per share (EPS) to grow 21% over the next 5 years. Comparatively, analysts expect GrubHub’s earnings to rise 27% over the same period.

WINNER: GrubHub

Analyst Recommendation

We have looked at key financial metrics for the two stocks. Let’s see what Wall Street analysts expect from the companies. Analysts have a 12-month average target price of $51.22 for Yelp, indicating an upside potential of 23%.

Comparatively, analysts expect GrubHub’s share price to rise to $296.94, providing an upside potential of 41% over the next year.

WINNER: GrubHub

It looks like GrubHub is a clear winner in this race. GrubHub is a better bet considering its profit margins and revenue and earnings growth rate. GrubHub also holds an edge due to a larger footprint and a solid reputation for customer service.

The food delivery segment is a high growth one with both companies looking to upstage the other and gain market share. We can see above that the domestic food delivery market is estimated to grow from $23.74B in 2016 to almost $40B in 2021.

Wealthlab Verdict: GrubHub (4-0)

Money

Airbnb Experiences: 5 Easy Ways To Make Extra Cash Today

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Airbnb Experiences: 5 Easy Ways To Make Extra Cash Today

Airbnb is a great way to earn money by renting out your home or apartment.

However, did you know that you can also make money by offering experiences on Airbnb? Here are five easy ways to make extra cash today by creating and offering Airbnb experiences.

1. Offer a food tour

If you love food, why not share your passion with others? Create a food tour experience in your city, showcasing the best local cuisine. You can offer a walking tour or a bike tour, and include stops at local markets, restaurants, and cafes. This is a great way to meet new people and earn money at the same time.

2. Teach a skill or hobby

Do you have a skill or hobby that you’re passionate about? Share your knowledge with others by offering an experience on Airbnb. You can teach anything from photography to cooking to yoga. People are always looking for new experiences, and they’re willing to pay for them.

3. Host a cultural event

If you come from a different culture, why not share it with others? Host a cultural event, such as a traditional dance, music, or art class. This is a great way to showcase your culture and make some extra cash.

4. Offer a nature experience

If you live in a beautiful area, offer a nature experience on Airbnb. You can offer a hiking tour, a kayaking trip, or a birdwatching tour. People love to get out into nature, and they’re willing to pay for it.

5. Host a wellness retreat

If you’re passionate about wellness, why not host a retreat? You can offer yoga classes, meditation sessions, and healthy meals. This is a great way to help people relax and recharge, while earning some extra cash.

In conclusion, offering experiences on Airbnb is a great way to make some extra cash. With these five easy ideas, you can get started today.

For more ideas and tips on how to make money, check out this Airbnb guide inside our academy.

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Money

10 Tips for Making More Money with Your Airbnb Listing

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If you’re an Airbnb host looking to increase your revenue, there are several strategies you can implement to make your listing more appealing to potential guests.

Here are 10 tips for making more money with your Airbnb listing:

  1. Set competitive pricing: Research the prices of similar listings in your area to ensure you’re offering a competitive rate. Consider lowering your prices during slow seasons or offering discounts for longer stays.
  2. Offer extra amenities: Providing extra amenities, such as a pool, hot tub, or complimentary breakfast, can make your listing more attractive to guests and justify a higher price.
  3. Invest in high-quality photos: High-quality photos of your space can make a big difference in how many bookings you receive. Consider hiring a professional photographer to capture the best aspects of your listing.
  4. Keep your listing up to date: Make sure your listing accurately reflects the current state of your property. Update your photos, descriptions, and amenities regularly to keep your listing relevant and appealing.
  5. Respond promptly to inquiries: Quick responses to guest inquiries can lead to more bookings and positive reviews. Make sure to check your messages frequently and respond as soon as possible.
  6. Provide excellent customer service: Going above and beyond for your guests can lead to positive reviews and repeat bookings. Make sure to communicate clearly and address any issues promptly.
  7. Offer local recommendations: Providing guests with recommendations for local restaurants, attractions, and activities can enhance their experience and justify a higher price for your listing.
  8. Allow instant bookings: Allowing guests to book instantly can make your listing more appealing to those who need to book at the last minute. However, make sure to set clear guidelines for instant bookings to avoid any issues.
  9. Offer discounts for repeat guests: Offering discounts to guests who have stayed with you in the past can encourage repeat bookings and increase your revenue over time.
  10. Keep your space clean and well-maintained: A clean and well-maintained space can lead to positive reviews and repeat bookings. Make sure to keep your space clean and address any maintenance issues promptly.

Implementing these 10 tips can help you make more money with your Airbnb listing and improve your overall hosting experience. Happy hosting!

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How Big Real Estate Moguls Avoid Taxes (And How You Can, Too) 👀

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I was looking around Google for an old article on tax strategies and this five-year old video of myself happened to pop up.

I’m interviewing a tax expert about how real estate investors avoid paying taxes in perpetuity—AND how everyday citizens can do the same thing.

(Real estate—our TEMPLE I and TEMPLE II projects included—has a number of tax benefits savvy investors have capitalized on for years, including Opportunity Zone breaks and 10-year tax abatements.)

There’s the 1031 exchange, of course, which I’ve shared with you guys before. 

Just to refresh your memory, the 1031 Exchange allows you to roll over gains from your last project into a new property TAX FREE—as long as said property is worth the same or more.

But there’s ANOTHER TAX LOOPHOLE that can take your portfolio to an entirely new level by splitting your capital gains into MULTIPLE properties.

So I thought I’d share it with you guys. 💎

You can check it out here.

Let me know what you think. 😎

PS: In our next update, I’m going to break down how real estate moguls get paid from their properties…tax free. 👀
PPS: If you want to learn how to implement generational wealth strategies like this one, you can join our NYCE wealth academy (TRIBE U) here.

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