Yelp shares were on track for their best day since 2012 after the company late on Wednesday lifted its full-year outlook and posted upbeat quarterly results.

Shares in the customer review site rose as much as 29.7 per cent to $49.51 — their highest in more than three years — before trimming their gains to trade 27 per cent higher as advertisers welcomed its move more flexible ad contracts that was completed in May.

“The company’s decision to move away from fixed-term contracts to non-term contracts has opened up the company’s sales funnel, allowing the company to add many new advertising accounts,” said Shebly Seyrafi, analyst at FBN Securities, who maintained an outperform rating and lifted the price target on the stock to $65, up from $60.

The results prompted a handful of other Wall Street analysts to bump up their price target on the stock.

Tempering some of the investor enthusiasm, however, was Brian Nowak, analyst at Morgan Stanley, who questioned how long Yelp would be able to sustain such growth.

“Transition to non-term contracts accelerated paying advertiser growth, although the sustainability of this growth and stickiness of these new customers is still uncertain,” he said, raising the price target on the stock to $42 from $40 previously while maintaining an equal-weight recommendation.

Following Thursday’s rally Yelp shares turned positive for 2018, up 15.4 per cent year-to-date.

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