Is It Undervalued? Look at the P/E Ratio: Yelp Inc. (YELP), The Procter & Gamble Company (PG)

Yelp Inc. (NYSE:YELP) shares were trading higher by 0.29 percent ($0.08) at $27.73 a piece in Tuesday’s session. It had closed the previous session at $27.65. YELP trades with a P/S ratio of 3.02. This is lower than the both industry’s 8.65 and the wider sector’s 1960.61. A low price-to-sales ratio, typically less than 1.0, is considered a good value. Also, it has an estimated price-earnings (P/E) multiple of 137.28 and a trailing 12-month price-earnings (P/E) multiple of 360.13. Shares of YELP have downtrended -17.72% in the past three months, while the industry overall has moved -19.02% in that time. Yelp Inc. (NYSE:YELP) has a market cap of $2.27 billion and over the last 12 months, YELP has gone stronger by 7.23%. During the last 52 weeks, the YELP price has been as high as $43.41 and as low as $25.46. Yelp Inc. (YELP) earnings have risen with an annualized rate of 26.5% over the last 5 years.

The average 1-year price target for Yelp Inc. (NYSE:YELP) — averaging the work of different analysts — reveals a mean PT of $31.34/share. That’s a potential 13.02 increase relative to where YELP has been trading recently. The current price is seen ranging between $27.46 and $27.84. There are brokerage firms with lower targets than the average, including one setting a price target of $18. And then on the other side of the spectrum one analyst entrenched in the bullish camp has a target as high as $46.

The collective rating of 2.6 for Yelp Inc. (YELP) also leans strongly towards the neutral end of the spectrum. Of the 34 analysts surveyed by Reuters that track YELP 17 of them rate its stock a hold. The other 17, though not evenly; between analysts who think you should buy Yelp Inc. (NYSE:YELP) versus those who think you should sell it. A 14 analysts rate it as either a buy or a strong buy, while3 believe that investors should either steer clear of Yelp Inc. (NYSE:YELP) or, if they already own its stock, sell it.

The Procter & Gamble Company (NYSE:PG) pulled off a 0.17 percent gain and now trades for $87.4. PG comes in with a P/S ratio of 3.44 that’s greater than 1, potentially implying that it could be expensive relative to the overall sector (6.51) and its peers (27.79). Also, it has an estimated price-earnings (P/E) multiple of 21.28 and a trailing 12-month price-earnings (P/E) multiple of 24.45. During the last 52 weeks, the price has been as high as $92 and as low as $80.86. The Procter & Gamble Company (NYSE:PG) earnings have declined with a quarterly rate of -4.2% over the last 5 years. Shares of The Procter & Gamble Company (PG) have sank -4.03% in the past three months, while the S&P 500 has dropped -6.1% in that time.

The Procter & Gamble Company (NYSE:PG) has a market cap of $224.03 billion and over the last 12 months, PG has risen by 7.33%. The average 1-year price target for The Procter & Gamble Company (PG) reveals an average price target of $92.05 per share. That’s a potential 5.32 gain from where PG has been trading recently. There are brokerage firms with lower targets than the average, including one setting a price target of $80. And then on the other side of the spectrum one analyst entrenched in the bullish camp has a target as high as $104.

The consensus recommendation — averaging the work of 20 analysts — of 2.5 for The Procter & Gamble Company (NYSE:PG) points to moderate case. Of the analysts surveyed by Reuters that track The Procter & Gamble Company (PG), 10 of them rate its stock a hold. The other 10 are split, though not evenly, between analysts who think you should buy its stock versus those who think you should sell it. A 8 analysts rate it as either a buy or a strong buy, while 2 believe that investors should either steer clear of PG or, if they already own its stock, sell it.