2016-02-08

What Happened to LinkedIn? $LNKD Stock Down 58% Since Nov 10

LinkedIn 1-year stock chart (NYSE:LNKD) (source: google.com)
What happened to LinkedIn (NYSE:LNKD)? The stock is now down 58% since Nov 10--the shares started tanking in after-hours trading last Thursday after reporting financial results which beat expectations for revenue and profit in the fourth quarter and showed solid growth, but the company's forecast for the current quarter and year disappointed investors--2016 first quarter earnings guidance of 55 cents per share (analysts' were expecting earnings of 74 cents per share), and LinkedIn forecast revenue of $820 million (analysts were projecting revenue of $866.86 million)--

"We will now end the call with our outlook for the first quarter and full year. For the first quarter, we expect: revenue of approximately $820 million, representing 29% percent growth. Adjusted EBITDA of approximately $190 million, a 23% margin. And Non-GAAP EPS of approximately $0.55 per share. For the full year, we expect: Revenue between $3.6 billion and $3.65 billion, a range of 20% to 22% year-over-year growth. This includes a 2% FX headwind. It also incorporates removing $50 million of potential Bizo revenue contribution in 2016. Adjusted EBITDA of between $950 million and $975 million, a 27% margin at the midpoint. And non-GAAP EPS of approximately $3.05 to $3.20 per share." --LinkedIn (LNKD) Jeffrey Weiner on Q4 2015 Results - Earnings Call Transcript | Seeking Alpha

So what's wrong? LinkedIn: Why So Surprised At The Drop? | Seeking Alpha: "... the investment community is starting to realize that the 30%+ growth rates are gone and that the lower growth does not support the current stock price. Hence the correction. LinkedIn is not Facebook (FB) ... Growth is slower and margins are lower."

Stocks in the whole tech sector have seen losses this year, as investors continue to closely examine "Internet valuations." See: Tech-stock wreck destroys $529B this year and Bye-bye Internet bubble 2.0 (USA Today). There are, of course, other views of what happened to LinkedIn, one of which you can read here and here.

Domain: LinkedIn.com



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