|$LNKD (LinkedIn Intraday Chart) - FreeStockCharts.com|
LinkedIn could start their own electronic staffing agency. How about taking it one step further; someone starts a professional social-networking site where users actually work for potential employers from their computer at home as unpaid TeleInterns™ or temp-to-hire TeleTemps™. Remember my post yesterday on telepresence hologram technology using Cisco/Musion Systems? Multiple TeleTemps™ could work in your office as holograms from their computers at home.
LinkedIn is growing significantly. From the prospectus:
Quarterly Adjusted EBITDA Trend
"We have achieved significant growth as our network has scaled and as we have expanded our product offerings. From 2009 to 2010, net revenue increased $123.0 million, or 102%, net income increased $19.4 million, or 487%, and adjusted EBITDA increased $33.3 million, or 227%. In the three months ended March 31, 2011, net revenue increased $49.2 million, or 110%, net income increased $0.3 million, or 14%, and adjusted EBITDA increased $4.2 million, or 46%, over the three months ended March 31, 2010. See “Adjusted EBITDA” below for a definition of adjusted EBITDA and a reconciliation of adjusted EBITDA to net income (loss)."
LinkedIn Quarterly Revenue Trend
As of March 31, 2011, LNKD's price/sales ratio as of today's close ($94.25 per share or $8.9 billion market cap) was 30 using $292 million trailing 12 month revenues (see numbers above). You can breakout earnings as well. The price/sales ratio seems pretty steep; however, if sales keep rising exponentially it could easily fill the gap. Read Henry Blodget's post showing different revenue, net income and EBITDA projections for 2011, 2012, 2013 and 2014.
Other comparables: Goldman Sachs's recent investment in Facebook (FBOOK) valued at 25x sales, Google (GOOG) trades at 5.5x sales, Yahoo (YHOO) at 3.5x sales, Salesforce (CRM) at 10.9x sales, OpenTable (OPEN) at 19.29x sales, China's Baidu (BIDU) at 33x sales, China's Renren (RENN) at 70x sales, Monster Worldwide at 1.9x sales, and Apple (AAPL) at 3.6x sales. How do you value this?
Interesting earnings comparable for Facebook (TheStreet.com):
"Using LinkedIn's current valuation as a comparable metric-- 600 times its 2010 earnings of $15.4 million -- Facebook would be worth around $360 billion in the public markets. The company reportedly earned $600 million in net income"
According to Trefis, LinkedIn is worth $30.07 a share, or $3.2 billion, "using the sum of the values of its divisions plus cash minus debt" (recruitment services and job postings, LinkedIn ads and marketing, premium account subscriptions and cash net of debt).
Here is a chart of LinkedIn's annual revenue breakout courtesy of Business Insider.
Key Metrics from the LinkedIn Prospectus as of March 31, 2011: Registered Members, Unique Visitors, Page Views and Corporate Solutions Customers
- LinkedIn IPO: Cramer Shares His Thoughts: (Cramer called it the "most outrageously overvalued, ridiculous thing" he's seen in years.") - CNBC Mad Money
- Henry Blodget: Here Are Wall Street's Real Estimates For LinkedIn (LNKD) ("THE TRUTH: Professional Investors Think LinkedIn Is The Next Open Table") - Business Insider
- Why LinkedIn Will Be a $25 Billion Company in 5 Years - Minyanville
- LinkedIn Would Be A $34 Stock Without Mania Premium (Trefis) - Forbes.com
- LinkedIn Debuts With a Bang, but Is It Worth $9B? (featuring Eric Jackson) - Daily Ticker
- How LinkedIn’s $8.9 Billion Valuation Compares to Other Companies - Mashable
- LinkedIn’s Stunning Public Debut Heightens Fears Of Bubble 2.0 (Eric Savitz) - Forbes.com
- LinkedIn: Worth $27 a Share? - Forbes.com [5/20/2011]