Market Commentary and Intraday News
Ahead of the Bell: LinkedIn rises in premarket
289 days ago
(AP:NEW YORK) Shares of LinkedIn climbed more than 7 percent before the market open on Friday as its second-quarter revenue increased faster than expected and the Internet company boosted its full-year revenue guidance.
Late Thursday, LinkedIn said that its quarterly revenue jumped 89 percent to $228 million. Analysts surveyed by FactSet predicted $216 million.
The Mountain View, Calif., company, which went public more than a year ago, now anticipates full-year revenue of $915 million to $925 million. It previously forecast revenue of $880 million to $900 million. Analysts had expected $907 million.
Mark Mahaney of Citi Investment Research said in a client note that LinkedIn had very impressive revenue growth for its three key segments: hiring solutions, marketing solutions and premium subscriptions. The analyst said this was important because the latest results faced a difficult comparisons and were affected by weakness in Europe and a stronger dollar.
When the U.S. dollar is rising against the world's other currencies, companies that sell goods internationally take a hit when converting revenue in foreign currencies back into the dollar.
Mahaney said that LinkedIn added 1,650 new customers during the quarter and received more revenue per customer during the period. The premium subscriptions unit added 13.3 million new registered members and its data showed that usage is up strongly, which the analyst believes "bodes well for future revenue growth for all three of the company's revenue segments."
Mahaney reaffirmed a "Buy" rating and $125 price target.
LinkedIn's stock added $6.99, or 7.5 percent, to $100.50 in premarket trading.
The company is among the best-performing of a group of newly traded companies including Facebook Inc. and Zynga Inc., with its stock trading at more than twice the level of its IPO price at a time when Facebook shares have lost nearly half their value. For the year to date, LinkedIn's shares are up 42 percent.
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