With shares of LinkedIn (NYSE:LNKD) trading at around $176.54, is LNKD an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:
C = Catalyst for the Stock’s Movement
LinkedIn has seen strong growth in almost every area. Q4 revenue was up 81 percent year-over-year. Talent Solutions revenue increased 90 percent, Marketing Solutions revenue increased 68 percent, and Premium Subscriptions revenue increased 79 percent. For 2012, revenue increased 86 percent over 2011. For 2013, LinkedIn expects revenue between $1.41 billion and $1.44 billion. For Q1, LinkedIn expects revenue between $305 million and $310 million.
LinkedIn now has approximately 202 million users. About 64 percent of these members are from foreign countries, which is a positive. If LinkedIn can grow globally as it has in the United States, then it will continue to see strong growth. LinkedIn’s current goals are to increase revenue, increase member count, and improve member engagement. LinkedIn has a specific game plan and is using new products and features to attain these goals. LinkedIn is also making Monster Worldwide (NYSE:MWW) look more like an ant than a monster. If there is a monster in regards to employment sites, it’s LinkedIn. In regards to the social networking environment, LinkedIn is at the top of the mountain looking down on everyone else when it comes to monetization. The key here is that LinkedIn doesn’t rely mostly on advertisements.
As far as website stats go, the past three months haven’t been so strong. According to Alexa.com, pageviews decreased 4.57 percent, pageviews per user decreased 3.71 percent, time on site decreased 2 percent, search decreased 3 percent, and bounce rate increased 3 percent. There are no positives here, but it’s a very short period of time and shouldn’t be overanalyzed. LinkedIn is the fourteenth most visited site in the world, and the eleventh most visited site in the United States.
Let’s take a look at some important numbers prior to forming an opinion on this stock…