Financial Comparison: Yelp (NYSE:YELP) versus LiveWorld (OTCMKTS:LVWD)

Yelp (NYSE:YELP) and LiveWorld (OTCMKTS:LVWD) are both computer and technology companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, valuation, dividends, risk, institutional ownership, analyst recommendations and profitability.

Institutional & Insider Ownership

90.1% of Yelp shares are owned by institutional investors. 8.0% of Yelp shares are owned by company insiders. Comparatively, 16.3% of LiveWorld shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Yelp and LiveWorld’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%
LiveWorld	2.97%	6.81%	3.98%

Volatility & Risk

Yelp has a beta of 1.03, meaning that its share price is 3% more volatile than the S&P 500. Comparatively, LiveWorld has a beta of 0.4, meaning that its share price is 60% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and target prices for Yelp and LiveWorld, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Yelp	2	4	0	0	1.67
LiveWorld	0	0	0	0	0.00

Yelp presently has a consensus price target of $34.00, indicating a potential upside of 8.58%. Given Yelp’s stronger consensus rating and higher probable upside, analysts clearly believe Yelp is more favorable than LiveWorld.

Valuation and Earnings

This table compares Yelp and LiveWorld”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Yelp	$1.41 billion	1.40	$132.85 million	$2.21	14.17
LiveWorld	$11.35 million	N/A	$60,000.00	$0.01	11.09

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

Summary

Yelp beats LiveWorld on 11 of the 12 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 LiveWorld

LiveWorld, Inc., a digital agency and software company, provides social media and technology solutions for pharmaceuticals, healthcare, and financial-travel service industries. It offers consulting, strategy, and creative solutions with human agents for moderation, engagement, customer care, and adverse events management, as well as conversation management software, and chatbots for digital campaigns and social media programs. The company was formerly known as Talk City, Inc. and changed its name to Liveworld, Inc. in May 2001. Liveworld, Inc. was incorporated in 1996 and is headquartered in Campbell, California.