|Bid||23.41 x 800|
|Ask||23.43 x 800|
|Day's Range||23.10 - 24.22|
|52 Week Range||12.89 - 38.40|
|Beta (5Y Monthly)||1.52|
|PE Ratio (TTM)||N/A|
|Earnings Date||Nov 05, 2020 - Nov 09, 2020|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||26.24|
Q1 2019 Yelp Inc Earnings Call
(Bloomberg) -- Big companies are going bankrupt at a record pace, but that’s only part of the carnage. By some accounts, small businesses are disappearing by the thousands amid the Covid-19 pandemic, and the drag on the economy from these failures could be huge.This wave of silent failures goes uncounted in part because real-time data on small business is notoriously scarce, and because owners of small firms often have no debt, and thus no need for bankruptcy court.“Probably all you need to do is call the utilities and tell them to turn them off and close your door,” said William Dunkelberg, who runs a monthly survey as chief economist for the National Federation of Independent Business. Nevertheless, closures “are going to be well above normal because we’re in a disastrous economic situation,” Dunkelberg said.Yelp Inc., the online reviewer, has data showing more than 80,000 permanently shuttered from March 1 to July 25. About 60,000 were local businesses, or firms with fewer than five locations. About 800 small businesses did indeed file for Chapter 11 bankruptcy from mid-February to July 31, according to the American Bankruptcy Institute, and the trade group expects the 2020 total could be up 36% from last year.While the businesses are small individually, the collective impact of their failures could be substantial. Firms with fewer than 500 employees account for about 44% of U.S. economic activity, according to a U.S. Small Business Administration report, and they employ almost half of all American workers.Justine Bacon permanently shut her Yoga Brain studio in Philadelphia after deciding it was too dangerous to hold indoor classes because of the pandemic. Bacon didn’t file for bankruptcy, she just simply closed up shop and went out of business on June 30.“I felt it better to close with some money in the account and not have to worry about bankrupting the business,” said Bacon, 35.No HelpChapter 11 bankruptcy gives a business protection from its creditors while the owners work out a turnaround plan. For smaller companies, though, the extra time might not make any difference. “Bankruptcy cannot create more revenue,” said Robert Keach, a restructuring partner at New England-based Bernstein Shur and former president at the American Bankruptcy Institute.Some owners fear bankruptcy could scar their credit reports and hurt their future chances to rebuild. Bankrupt businesses have a nearly 24 percentage point higher likelihood of being denied a loan, according to the SBA, and a filing can show up on a credit report for 10 years.That’s one of Rebecca Schner’s concerns. Things were looking up for Schner, 51, and her jewelry and fair trade shop New Lotus Moon in The Woodlands, Texas. She opened in 2018 and finally started to break even at the start of this year.Then the virus hit. After the store closed to walk-in customers, she said sales dropped and she couldn’t cover rent. She emptied the shop around mid-May, moved her jewelry cases into storage, and dismissed her part-time employee. She’s making minimum payments on nearly $50,000 in loans.“What if I want to have a mobile boutique and go buy a vehicle for that? Would I be able to get a loan?” Schner said.Lost RevenueTo be sure, small business attrition is high even in normal times. Only about half of all establishments survive for at least five years, according to the SBA. But the swiftness of the pandemic and the huge drop in economic activity is hitting hard among typically upbeat entrepreneurs. About 58% of small business owners say they’re worried about permanently closing, according to a July U.S. Chamber of Commerce survey.In a June 2020 NFIB survey, a net 31% of owners reported lower sales in the past three months, while 7% reported higher sales a year earlier. In the same survey, only 13% of business owners said it was a good time to expand, a dip from 24% a year earlier.Jose Gamiz, 45, and Leticia Gamiz, 52, closed their restaurant in Glendale, Arizona on July 31. The bills started piling up, and while thousands in government loans helped, they weren’t taking in enough cash. They had four part-time employees.It was too much of a gamble to keep Mi Vegana Madre open, Jose Gamiz said. The couple knew the dangers of taking risks after they lost the first house they bought during the 2008 crisis.“We wanted to take that as a lesson,” Jose Gamiz said. “Sometimes it’s okay to let it go and not expend every penny.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- In the late 1990s, when David Boies(1) prosecuted the Microsoft antitrust trial, he told me that despite the thousands of documents, emails and deposition transcripts that were rolled into court each day, no more than 50 were the key to the government’s case. He memorized them and knew right where to find them if he needed them in the middle of a cross-examination.Of those 50, maybe two dozen were the kind you just don’t forget — bald, vivid illustrations of what the government hoped to prove: that Microsoft was using its monopoly power to squeeze Netscape, the upstart browser company that Microsoft viewed as a potential threat to its Windows monopoly.“How much do we need to pay you to screw Netscape?” Microsoft founder Bill Gates asked, according to an email recapping a meeting with AOL executives. (He added, “This is your lucky day.”)In another email, Gates suggested that Microsoft offer Intuit “something like $1M … in return for switching browsers” from Netscape to Microsoft’s Internet Explorer.There were plenty of others just like those. Collectively, they showed Microsoft was willing to use every trick in the monopolist’s handbook to “cut off Netscape’s air supply,” to use another memorable phrase that came out of the trial: offering financial incentives to computer makers that stopped pre-installing Netscape; giving away its browser free; leveraging its operating system to favor its own browser over its rival’s.If you read about the recent hearing before the House Judiciary Committee antitrust subcommittee, you already know why I took this little trip down memory lane. The news articles focused on what was said during the five-hour hearing, both by the lawmakers asking the questions and the four tech CEOs who were answering them — Amazon’s Jeff Bezos, Apple’s Tim Cook, Facebook’s Mark Zuckerberg and Google’s Sundar Pichai.But the committee also posted on its website a handful of internal emails the companies had turned over. My colleague Tara Lachapelle made the point that the nation’s primary competition law, the Sherman Antitrust Act, was enacted more than 100 years ago and was aimed at then-dominant businesses like railroads. Preventing abusive monopoly practices by today’s dominant technology companies has proved to be difficult in part because antitrust law never anticipated the business models that have made Google, Facebook and others so powerful.Up to a point, I agree. That’s why a new breed of antitrust thinkers such as Lina Khan (who is working with the Democrats on the antitrust panel) and the economist Hal Singer have developed new ideas for reining in Big Tech. But the emails suggest that even without passing new laws, a lot can be done to stop Big Tech’s monopolistic practices. There are enough similarities between those old Bill Gates emails and the documents released by the antitrust panel to make me think that a few good old-fashioned lawsuits might well do the trick.Let’s take a look at what the committee unearthed from Facebook, Amazon and Google,(2) shall we?“Instagram is eating our lunch,” begins an internal Facebook discussion. “We should have owned this space but we are already losing quite badly. … I find myself checking it far more often than FB mobile. It is a far more focused, compelling way to keep up with what my friends are doing.”Someone in the discussion responds, “Isn’t that why we’re building an Instagram clone?”In another email, Zuckerberg considers a different way to deal with the new competition: “Yeah, I remember your internal post about how Instagram was our threat,” he writes to an executive whose name has been redacted. “One thing about startups though is that you can often acquire them. I think this is a good outcome for everyone.” Which of course is what happened: Facebook bought Instagram for $1 billion in 2012. It was an excellent outcome for Facebook but not so much for anyone who hoped to see competition among social media companies.Amazon:“More evidence these guys are our 1 short-term competitor,” read a 2009 email referring to Diapers.com. “As I’ve mentioned to each of you, we need to match pricing on these guys no matter what the cost.” Another email in the same chain read, “They may be giving us a run for our money. We can approach them through the ‘We would be willing to explore a range of relationships’ angle.” In 2011, Amazon bought Diapers.com’s parent company, Quidsi, for $545 million. (It shut down the brand in 2017).During the hearing, Democratic Representative Pramila Jayapal confronted Bezos with reports that Amazon used data it gleaned from firms that sell their wares on the company’s platform to favor its own competing products. Bezos responded by saying that while that was against company policy, “I can’t guarantee you that policy has never been violated.” Google:Most of the Google documents released by the committee had to do with acquisitions — of DoubleClick and YouTube especially — but there was one in particular that caught my eye. It was about “verticals,” in which Google uses its main search engine to promote its own industry-specific products in areas such as travel and local business reviews over those from companies such as Expedia and Yelp. At the time the email was written, the company was trying to decide whether — and how — to start offering verticals. “What is the real threat if we don’t execute on verticals?”a) “Loss of traffic from google.com … .b) Related revenue loss to high spend verticals like travel.c) Missing oppty if someone else creates the platform to build verticals.d) If one of our big competitors builds a constellation of high quality verticals, we are hurt badly.”Google of course did begin offering “high quality verticals,” and companies such as Yelp have complained to antitrust regulators ever since that Google is using its platform to favor itself at the expense of companies that rely on it for their lifeblood.Even though antitrust law might need to be amended to clarify what is —and isn’t — acceptable practices by the big tech companies, these emails and documents show that there is already enough evidence to file antitrust lawsuits. “Mergers and acquisitions that buy off potential competitive threats violate the antitrust laws,” Jerry Nadler, who is chairman of the Judiciary Committee, said to Zuckerberg. “In your own words, you purchased Instagram to neutralize a competitive threat.”Amazon’s practice of losing money on a product to hurt a rival isn’t all that different from Microsoft giving Internet Explorer away free knowing that would make it difficult for Netscape to compete. Google using its platform — a platform thousands of companies can’t live without — to favor itself is also similar to Microsoft behavior the Justice Department viewed as illegal.Would these lawsuits take years to play out in the courts? Yes. But the common complaint that technology moves too fast for the court system is wrong. Microsoft lost at the trial stage, and although much of the district court’s decision was overturned on appeal, that had less to do with the facts than with the judge, Thomas Penfield Jackson, who had foolishly talked to certain reporters behind the scenes during the trial. In the end, though, the Justice Department won. In 2001, Microsoft settled with the federal government; more important, its behavior changed. Microsoft ended its abusive practices. Operating systems became less important. Google, Facebook and Amazon were all able to emerge without having to worry about threats from Microsoft.Google, Facebook and Amazon can also be forced to end their abusive practices. What’s needed is an antitrust department willing to take the companies to court. Thanks to the congressional panel, the evidence is already there.(Corrects the given name of Lina Khan in the eighth paragraph.)(1) My wife has been Boies’s longtime media adviser. But she had no connection to him — or me, for that matter — when I covered the Microsoft trial for Fortune magazine.(2) The committee released emails from Apple as well. The primary antitrust issue with Apple is the power of its app store to help or hurt companies offering apps. Although many of the Apple emails related to app store issues, the antitrust implications of most of them was not readily apparent.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Joe Nocera is a Bloomberg Opinion columnist covering business. He has written business columns for Esquire, GQ and the New York Times, and is the former editorial director of Fortune. His latest project is the Bloomberg-Wondery podcast "The Shrink Next Door."For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.