I Know First Review: Is LNKDN Undervalued?

I Know First Review

I Know First Review

LinkedIn Corporation (LinkedIn) is a professional network on the Internet. The Company’s three product lines include Talent Solutions, Marketing Solutions and Premium Subscriptions. All three product lines are sold through two channels, an offline field sales organization, which engages with both large and small enterprise customers, as well as an online, self-serve channel, which includes enterprise customers and individual members purchasing subscriptions.

I Know First also publish in  Seeking Alpha  a bullish algorithmic forecast about LinkedIn on July 1st, claiming that the expansion of their international market would have positive repercussions in the following periods. Their revenue increased by approximately 35% year-over-year. But then there was a slight decline and since the forecast the stock has gone up 15.43%. A positive remark is that from the end of August to the end of November the stock went up 44.56%

Jennison Associates boosted its position in LinkedIn Corp (NYSE:LNKD) by 0.3% during the third quarter, according to its most recent disclosure with the Securities and Exchange Commission. The hedge fund owned 6,390,275 shares of the social networking company’s stock after buying an additional 19,651 shares during the period. LinkedIn Corp accounts for about 1.2% of Jennison Associates’ holdings, making the stock its 18th largest position.

Analyst Rob Anderson believes that LinkedIn has a premium valuation to Internet leaders, however,their stock is valued  below the major SaaS players. LinkedIn reported not so long ago strong third quarter earnings, they not onl exceeded estimates but also raised the 4Q outlook. This big performance has blown away various issues regarding the company, and the firm believes that the stock’s value will continue to increase to its historic range of 30x to 35x forward earnings before interest, taxes, depreciation and amortization.

The original bullish algorithmic forecast:

Linked Stock

(Figure 1: LNKD Forecast June 30th ’15)