Bank Of America: Yelp's Old 'Story' Is Over; Stock Downgraded

In a report published Friday, analysts at Bank of America Merrill Lynch downgraded

from Buy to Neutral. The price target was also lowered from $65 to $55. The company reported disappointing Q1 results. Given the below expectations revenue and EBITDA reported by the company for Q1, largely due to brand revenue mix and sales force execution issues, the analysts believe that "Yelp is no longer a beat and raise story." The local business account additions for the quarter were the lowest witnessed in the past eight quarters. The current 2015 revenue guidance implies that the company would need to bring about acceleration in 2H, which the analysts believe would only occur with flawless execution. The analysts also believe that the guidance is now more back-end loaded. Bank of America Merrill Lynch has lowered its 2015 estimates for the company, with the revenue estimates below the guidance levels.