The growing global access to the internet and widespread smartphone usage have broadened the potential audience for digital platforms. Moreover, the online platform market is marked by swift technological progress, including advancements in artificial intelligence, machine learning, and big data analytics, which are more frequently incorporated to improve user experiences and tailor content.
Additionally, the wider availability of high-speed internet, the growth in smartphone usage, and the growing presence of digital payment options are making it much easier for people worldwide to shop on international e-commerce platforms, which is driving the market’s growth. The global e-commerce market is expected to grow at a CAGR of 25.8% by 2033.
Against this backdrop, let’s compare two online platform stocks to analyze which is more attractive for investors: Yelp Inc. (YELP) and Match Group, Inc. (MTCH).
The Case for Yelp Inc. Stock
With a $2.62 billion market cap, Yelp Inc. (YELP) operates a platform that connects consumers with local businesses in the United States and internationally. Its 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.
On December 10, 2024, YELP announced its end-of-year product release featuring more than 20 new updates designed to enhance the user experience for consumers and business owners.
YELP also announced AI-powered improvements to the business owner experience with features like job summaries that help manage their inbox and a smart selection tool that automatically optimizes ad performance.
On November 26, 2024, YELP announced that it had completed its planned acquisition of RepairPal, an auto services platform, for approximately $80 million in cash, subject to customary post-closing adjustments.
YELP’s stock has gained 14.3% over the past three months to close the last trading session at $39.82.
YELP’s 1.39x trailing-12-month asset turnover ratio is 184.2% higher than the 0.49x industry average. Also, its 12.04% trailing-12-month Return on Total Assets is 571.4% higher than the 1.79% industry average.
YELP’s net revenue for the third quarter, which ended on September 30, 2024, increased 4.4% year-over-year to $360.34 million. In addition, the company’s net income was $38.44 million, or $0.56 per share. Its adjusted EBITDA stood at $101.36 million.
For the fourth quarter ended December 2024, YELP’s revenue is expected to increase 2.2% year-over-year to $350 million. Its EPS for the ongoing quarter is expected to be $0.95. Moreover, the company surpassed EPS estimates in all the trailing four quarters, which is impressive.
YELP’s POWR Ratings reflect its promising outlook. The stock has an overall rating of A, which translates to a Strong Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
The stock has an A grade for Value and Quality and a B for Growth. YELP is ranked first out of 47 stocks in the A-rated Internet industry.
In addition to the POWR Ratings I’ve just highlighted, you can see YELP’s ratings for Momentum, Stability, and Sentiment here.
The Case for Match Group, Inc. Stock
Match Group, Inc. (MTCH) is valued at $8.43 billion by market cap and provides dating products. Its portfolio of brands includes Tinder, Hinge, Match, Meetic, OkCupid, Pairs, Plenty of Fish, Azar, BLK, and Hakuna, as well as various others, each built to increase users' likelihood of connecting with others.
Shares of MTCH have surged 2.8% over the past month but declined 9.1% over the three months to close the last trading session at $33.58.
In terms of the trailing-12-month CAPEX/Sales, MTCH’s 1.45% is 59.3% lower than the 3.57% industry average. However, its 71.51% trailing-12-month gross profit margin is 37% higher than the 52.19% industry average.
MTCH’s revenue declined 1% year-over-year to $860 million for the fiscal 2024 fourth quarter, which ended December 31, 2024. Moreover, the company’s net earnings declined 68.9% year-over-year to $158.28 million, and its EPS came in at $0.59.
For the first quarter ending March 2025, MTCH’s revenue is expected to decrease 3.8% year-over-year to $827.05 million. However, its EPS for the ongoing quarter is expected to increase 5.3% year-over-year to $0.67.
MTCH’s fundamentals are reflected in its POWR Ratings. The stock has an overall C rating, translating to Neutral in our proprietary rating system.
MTCH has a C grade for Momentum and Stability. It is ranked #26 in the same industry.
Click here for the additional POWR Ratings for MTCH (Growth, Value, Sentiment, and Quality).
Yelp Inc. (YELP) vs. Match Group, Inc. (MTCH): Which Online Platform Is More Attractive for Investors?
The online platform industry is projected to experience substantial growth in the upcoming years, fueled by greater internet access, widespread smartphone use, and progress in digital technologies.
Leading online platform companies YELP and MTCH stand to capitalize on the optimistic industry outlook. However, YELP’s strong profitability might make it the better online platform stock pick.
Our research shows that the odds of success increase when one invests in stocks with an Overall Rating of Strong Buy or Buy. View all the top-rated stocks in the Internet industry here.
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MTCH shares were trading at $34.37 per share on Thursday afternoon, up $0.79 (+2.35%). Year-to-date, MTCH has gained 5.69%, versus a 2.85% rise in the benchmark S&P 500 index during the same period.
About the Author: Nidhi Agarwal
Nidhi is passionate about the capital market and wealth management, which led her to pursue a career as an investment analyst. She holds a bachelor's degree in finance and marketing and is pursuing the CFA program. Her fundamental approach to analyzing stocks helps investors identify the best investment opportunities.
Yelp Inc. (YELP) vs. Match Group, Inc. (MTCH): Which Online Platform Is More Attractive for Investors? StockNews.com
