I don't think LNKD's site is for everyone but I know an awful lot of business people who use it. They will never use it in the manner people use FB, etc, (or I doubt they ever will) but it has many uses which can (eventually) be monetized. There is absolutely no question that they can improve their interface and "ease of use", add functions, etc..
I completely understand anyone who questions the valuation metrics. As with most infant companies, it's very tough to gauge the long term. Similarly, whenever they are cautious about a quarter or decide to ramp up spending in one area or another, the valuation metrics need to viewed with even more skepticism.
At the same time, they've show an ability to not only grow quickly but steadily. In 2010, they only had 250 Million in sales and now they're doing 1.5 billion, with next year's estimates up to 2.1 Billion.
Can they translate the sales growth to the bottom line? The 64 billion dollar question. The aggressive analysts say yes and have targets over $4/share in a couple years. Certainly, a forward PE of 45 or 50 for 2 years out should be questioned. Last quarter they barely beat expectations, which is why (IMO) that the stock is down but they warned during the previous earnings release for "caution" in the 4th quarter. Prior to this latest quarter, they handily beating expectation. |
