On Friday in premarket trading LinkedIn Corp’s shares gained 10 percent. Strong demand for LinkedIn Corp’s services that enabled the company to expand its staff and favored the increase of its quarterly earnings resulted eventually in the rise of the LinkedIn shares.
Taking into account that investors constantly keep a close watch on the model sustainability, LinkedIn Corp’s strong results indicate that social and professional networking sites are really prospering.
Facebook, the world’s No1 social networking site, is preparing to the biggest IPO ever held.
LinkedIn, a business-related social network, which is pulling in by helping companies to recruit new employees, checked-in 16 million members over the first quarter of 2012. Currently, the corporation numbers more than 161 million members.
Michael Graham, analyst at Canaccord Genuity, in a research note to clients said that LinkedIn’s ‘employees’ network is building up a so-called pull that is bolstering its product set as an essential part for human resources professionals.
He also noted that these products are in the early stage of a long-term penetration curve that will guarantee the continued growth of expectations.
Thomson Reuters StarMine awarded Graham four stars for the accuracy of his earnings estimates on LinkedIn Corp. Usually analysts receive five stars if they are at the top 10 percent of analysts and four stars – at the next 23 percent. Graham, by the way, raised the price target on the stock from $95 to $135.
Since a considerable number of people sign-up via their tablets and smartphones, analysts predict that the company, in order to drive up its sales, will plunge into mobile usage.
Doug Anmuth, analyst at J.P. Morgan Securities said that LinkedIn Corp is destroying online as well as offline job recruitment markets. And increase in recruitment will bring company a startling success.
LinkedIn Corp, founded by Reid Hoffman in cooperation with the ex-PayPal members in 2002, claimed on Thursday it acquired SlideShare, a content sharing company, for around $119 million. LinkedIn said that a new purchase will enable its users to upload and share presentations.
The price target on the stock was also raised by analysts from Barclays Capital, Citigroup, Evercore Partners and BMO Capital.
Referring to Thomson Reuters StarMine, the stock is rated as “strong buy” by two analysts, eight analysts rate it “buy”, eleven considers the stock as a “hold”, and one rates it as a “sell”. $108.47 is the lowest price target on the stock.
On Thursday LinkedIn shares were estimated at $109.41 and on Friday the price reached $119.50.