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.
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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.