Wall Street analysts raised their earnings estimates for LinkedIn Corp (NYSE:LNKD) for 2014 and 2015 after the world’s largest professional network delivered solid financial results for the second-quarter due to the strength of its Talent Solutions segment.
LinkedIn Corp (NYSE:LNKD) also issued a better-than-expected business outlook for the third-quarter and full year 2014. The company also announced the launching of its new Sales Navigator intended to improve the connection between sales professionals with key customers.
The Sales Navigator is expected to generate strong revenue similar to the Talent Solutions segment.
Sterne Agee: China offers long-term opportunity for LinkedIn
Sterne Agee analysts Arvind Bhatia and Brett Strauser noted that the second-quarter financial performance of LinkedIn Corp (NYSE:LNKD) was the best over the past six-quarters because of the 57% growth of its Talent Solutions segment.
Bhatia said the future growth of LinkedIn Corp (NYSE:LNKD) is long as core business driving near-term trends. According to him, Sales Navigator offers a potential medium-term opportunity for the company while China provides a long-term opportunity for the company.
“China has recently become LinkedIn fastest growing major market for new members, although monetization will likely take several years,” wrote Bhatia in a note to investors.
Full year 2014/2015 estimates
Bhatia raised his adjusted EBITDA, and non-GAAP EPS estimates for LinkedIn Corp (NYSE:LNKD) for 2014 and 2015.
The analysts forecasted that LinkedIn Corp (NYSE:LNKD) would be able to deliver adjusted EBITDA of $563 million and non-GAAP EPS of 1.89 for 2014. Bhatia’s previous adjusted EBITDA and non-GAAP estimates were $517 million and $1.61 for 2014.
For the full year 2015, Bhatia estimated that the company would be able to achieve $821 million adjusted EBITDA and $2.99 non-GAAP EPS. His previous estimates were $748 million and $2.43.
Raymond James positive on LinkedIn’s fundamentals and long-term growth
On the other hand, Raymond James analysts, Aaron Kessler and Ben Cohen stated in their note to investors that they are positive on the fundamentals and long-term growth potentials of LinkedIn Corp (NYSE:LNKD).
Kessler and Cohen maintained their Outperform rating for the stock as they believe that it is “fairly valued at current levels.”
The analysts also raised their full-year 2014 and 2015 GAAP EPS and revenue estimates for LinkedIn Corp (NYSE:LNKD).
For the full year 2015, Kessler and Cohen estimated that the company would be able to deliver (-$0.07) GAAP EPS on $2.19 billion in revenue compared with their previous estimates of (-$0.33) GAAP EPS on $2.14 billion in revenue.
The analysts forecasted that LinkedIn Corp (NYSE:LNKD) would be able to generate $0.51 GAAP EPS on $2.89 billion in revenue for 2015, up from their previous estimates of ( $-0.11) GAAP EPS on $2.79 billion in revenue.