U.S. professional networking site LinkedIn (LNKD) CEO Jeff Weiner became the Forbes magazine cover, as a matter of fact, LinkedIn’s success is actually not secret at all, its situation is similar with Facebook (FB): these two social networking sites are free to obtain information from the users. LinkedIn’s users do not simply store on their resumes in computers, or submit it to staffing agency sites, but voluntarily release all kinds of information online.
When different kinds of people gathered on this site, the corporate personnel departments and the hunter companies will naturally follow here. More and more are beginning to be willing to pay to get the information of LinkedIn’s users, because the latter is likely the talents that they are looking for.
Favorable operating data:
According to the traffic data provided by market research company Experian Hitwise, LinkedIn ranked the number-eight of the top U.S. social networking sites, with weekly visits of 20,235,962 as of the week ended June 30.
The intresting data come in as the follows:
-Users on average spend 18 minutes a month spent on the LinkedIn site versus 6.4 hours on the Facebook site.
- Each online user of LinkedIn averagely contributes revenue of $1.3 to LinkedIn versus only 6.2 cents contributed to Facebook by per user every hour on its site. It is amazing and interesting that the former is 20 times the latter.
LinkedIn Recruiter, the most expensive product of LinkedIn, charges each user an annual license fee of up to $8,200. LinkedIn’s big customer Adobe bought 70 Recruiter user licenses. On the basis of the price offered by LinkedIn, just such a customer generates approximately $500,000 in revenues for LinkedIn. Top salesman of the division LinkedIn Recruiter earns an annual income of up to $400,000.
Like other best stocks, LinkedIn has solid and favorable operations. For the fiscal 2012 first quarter, inkedIn grew revenues by 101%, to $188.5 million, compared to a year ago. Adjusted EBITDA was $38.10 million, 186.5% higher than the previous year same period’s $13.30 million. Net profit reached $5.00 million, representing a surge of 138%, compared to last year same period’s $2.10 million. Earnings per share reached $0.15, a surprise of 66.70% over the average analyst estimate of $0.09.
LinkedIn spends 33% of the total revenue for product sales and marketing. This will enhance the future growth and earning power.
Stock performance:
LNKD stock closed up 0.85%, or $0.91, to end at $108.54 in the latest trading session on July 3, 2012. On the basis of the closing price, LNKD stock price has gained 72.26% year to date, and is currently standing above the 50-day moving average of $103.18 and the 200-day moving average of $86.84. Over the past 52 week, LNKD stock traded as high as $120.63, and as low as $55.98, the latest closing price is very close to the peak.
LNKD stock trades at a trailing-12-month P/E multiple of 743.42, well above Facebook’s 77.81. But from the perspective of PEG raito, LinkedIn stock is priced almost flat with Facebook, as the former has a PEG ratio of 2.43, the latter has a PEG ratio of 2.25, respectively.
Despite the “Best stock” characteristics of LinkedIn, in view of LinkedIn’s relatively high valuation over the the big board, to buy the stock needs to be more cautious. Investor must pay more attention to the recent charts, so as not to take an over-high price on this stock.