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Yelp, Pandora could be good takeover candidates, but not Netflix, analyst says

Mahaney: Netflix takeover unlikely

Yelp and Pandora could be the next good takeover targets in tech, but a Netflix deal probably isn't in the cards, analyst Mark Mahaney told CNBC on Tuesday.

Chatter about potential mergers has picked up after AT&T recently announced it was buying Time Warner for $85.4 billion.

Mahaney believes the biggest takeout target in the sector is Yelp, which he said could fit into a lot of different companies.

He's held that theory for about a year, and now that Yelp has recently gone from a dual class stock structure to a single one, he believes it has become "more plausible" for someone to bid for the company, even as a hostile bid.

However, any potential buyer will be looking to see if Yelp can build out its transactions capability, Mahaney said in an interview with "Power Lunch."

"Can you actually show that you're leading people to takeouts, to doing restaurant reservations, to actually lining up directly with plumbers in the area? Not just advertising, but can you show transactions revenue? If they prove that, I think they become more viable as a takeout candidate."

The Yelp app on an Apple iPad Air
Andrew Harrer | Bloomberg | Getty Images

He also thinks Pandora is an "interesting takeout candidate" and believes Twitter can still be a long-term candidate, although not at the current price and some of the strategies currently in place.

However, Mahaney doesn't think a Netflix deal will happen.

"Probably the biggest reason is just the size of the asset. With $56 billion market cap, there are very few names who could actually make that deal even plausibly work — maybe a Disney, maybe a Google, maybe an Amazon, maybe an Apple," he said.

Plus, "you don't have a willing seller."

Speculation about a possible Netflix deal has been swirling around Wall Street.

In an interview with CNBC on Monday, Netflix CEO Reed Hastings wouldn't respond to conjecture that the streaming company would be a great acquisition target for the likes of Apple.

When asked about whether the time could be right to sell the company to a tech giant, Hastings responded by focusing on his company's track record. He also stressed that the company's success is based on a commitment to the company's product and content, and the discipline of staying away from deals.

"That's what made us successful for the last 14 years is we've done no M&A. We've stayed out of all those discussions. We don't do bankers meetings. We're very old school in that way," said Hastings.

CNBC's Julia Boorstin contributed to this report.

Disclosures: RBC Capital Markets has provided GOOGL, AMZN with non-securities services in the past 12 months. RBC Capital Markets owns Pandora.