Linkedin Corporation (NYSE:LNKD) is all set to release its earnings report for the first three months of 2013 today, Thursday May 5th, after the market closes. Analysts are looking for earnings of 31 cents per share from the company for the quarter. The firm's stock has had a good run so far in 2013, but questions persist about whether the firm is really worth it.
Linkedin Corporation (NYSE:LNKD) Increase In Shares
Since the start of 2013, shares in Linkedin Corporation (NYSE:LNKD) have risen by more than 70 percent. The company is at the forefront of what some are calling a new social media bubble, along with LinkedIn. With shares trading at such a high valuation, investors have a right to be worried about the future of the company's stock, but analysts from JPMorgan Chase & Co. (NYSE:JPM) think the firm's stock should go up even further.
The new report from analysts at the investment bank puts a price target of $163 on Linkedin Corporation (NYSE:LNKD), and gave the stock an overweight rating, despite the current price of closer to $200. LinkedIn shares are a divisive topic, but the JPMorgan Chase & Co. (NYSE:JPM) consensus is that the company has a huge amount of room for growth, and now might be the time to buy in.
According to the report, Linkedin Corporation (NYSE:LNKD) will report a stellar quarter this time around, expecting 33 cents per share. One of the indicators for the company will be the effects of the firm's new products in the rest of 2013. The company unleashed a slew of new upgrades to its service in the last six months, and may be ready to offer more in throughout 2013.
These upgrades are supposed to do two things for the company. The first is the attraction of new users to its site, and the second is an increase in the company's average revenue per user. JPMorgan Chase & Co. (NYSE:JPM) thinks that the new products and upgrades can improve both of these metrics for the company.
Linkedin Corporation (NYSE:LNKD) has some very distinct advantages over some of the other social networking firms. The company has a great revenue stream, in the form of subscription fees, and the market it operates in is inelastic to price. One example given in this report is the doubling of the company's paying base since the last time it increased its membership prices.