Yelp Investors Need Help As Shares Plummet

Yelp Inc YELP shares fell 9 percent during Tuesday's session amid fears Facebook could enter the company's backyard with a service called "Professional Services," letting users find top-rated businesses. Yelp investors clearly need help, and for anyone considering a buy the dip play, there are a few data points to consider.

Insider sales and shorts. According to SEC data via FinViz, insiders have lowered their holdings in Yelp over the past six months by 41 percent. Short-sellers don't "love" the stock by any means, but short interest metrics leave something to be desired. An estimated 14 percent of Yelp's float is short, more than most peers.

Insane valuation metrics. Yelp trades at astounding valuation metrics, and even though no one's jumping on the stock because of a P/E ratio, it bears watching. Yelp's P/E is 244, forward P/E is above 1,000 and its PEG when accounting for growth is almost 10 times the level of a "fair" value.

Street's staying away. Lastly, the Street isn't loving Yelp. Six firms -- Topeka, Raymond James, Oppenheimer, Morgan Stanley, MKM and JMP -- downgraded the stock after the company cut guidance in July. "Almost everyone is downgrading Yelp today," Benzinga wrote at the time. More recently, Roth Capital has initiated Yelp at a Sell citing poor local outlook, something the firm harped on Tuesday amid the latest selloff.