In the brief video above, Hedgeye Internet & Media analyst Hesham Shaaban fires off his favorite long and short stock ideas from a recent Sector Spotlight presentation and live Q&A.
Below are some of Shaaban's responses along with a brief sentence or two outlining the thesis from the Sector Spotlight video at the bottom of this post.
Best Short Idea?
Shaaban: Yelp (YELP)...
The setup right now smells like 1Q15 when YELP guided light for 1Q and inline for the full-year. Consensus has responded to the lopsided guide by raising 2H17 estimates, which ironically is when we were most bearish on the story to begin with.
Best Long Idea?
Shaaban: Pandora (P) or TripAdvisor (TRIP)...
Pandora appears to be ramping ad load far more aggressively than we had expected, which should help prod users into its subscription product, but also trim some fat out of the model since some users will initially fade that ad load. That combo of rising ad load and curbed hours should improve near-term profitability.
TripAdvisor (TRIP): The inflection actually started in January, but no one seemed to care since TRIP guided to flat EBITDA growth for 2017, which it already flagged on the 3Q print. TRIP'S 2016 wounds were largely self-inflicted, but are being remedied this year, and we're not even talking about the comps. Couple that with a more aggressive marketing budget, and TRIP's Hotel segment could be a 20-30% top-line grower this year.
* * * *
To watch Shaaban's entire Sector Spotlight presentation click the video below...