

Analysts Wary of LinkedIn’s Stock Surge - garbowza
http://www.nytimes.com/2011/05/23/technology/23linkedin.html

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il
Best part of the story:

"Price-to-earnings comparisons for other hot Internet companies, like
TheGlobe.com or even Netscape on their opening days, are difficult as they did
not have any earnings."

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stevenj
To those who are thinking about shorting it when that becomes available:

If you buy LinkedIn at $100, the most you can lose is $100. But if you short
at $100, your loss can be infinite.

As a short seller, you could run out of money before the promoter(s) runs out
of ideas.

Being short a stock, while seeing some promoter taking the stock up would be
quite agonizing.

You may be right about it being overpriced, but that's not enough. When it
comes to shorting, it's the timing that you have to get right. And that's
really hard.

It's okay to just sit this out.

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DarkShikari
_If you're long LinkedIn at $100, the most you can lose is $100. But if you
short at $100, your loss can be infinite._

This is what put options are for.

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stevenj
That's true.

But IMO, to make it worthwhile, you still have to get the timing right. That's
the hard part.

Identifying a bubble is relatively easy. What you don't know is how big it'll
get and when it'll pop.

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shawnee_
LinkedIn was smart to go public before Facebook.

However, $8B for what essentially amounts to a glorified harassment tool for
recruiters is a bit ludicrous.

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dstein
LinkedIn could be turned into the world's best job board. But it is currently
built like an old-fashioned dating site. It's like Match.com for jobs.

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wollongong
$15 million profit, $8 billion valuation

LOL

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rooshdi
Yep, Bubble 2.0 is upon us. I just hope people can put two and two together
this time and get out before it bursts.

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billmcneale
You are like these crazies announcing the end of the world. Yes, it will
happen eventually, but if you don't know when, you're not adding anything to
the debate by stating the obvious.

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rooshdi
The end of the world and a bubble are two entirely different things. I can
also argue that your statement didn't add anything either without stating the
obvious.

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akkartik
_"Linkedin IPO: net revenue $100M, market cap $4B. Google IPO: net revenue
$800M, market cap $24B."_
<http://twitter.com/akkartik/status/72519743835348992>

Seems pretty reasonable.

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ScottBurson
To know whether it's reasonable, you need to know not only the amount of
revenue but also the revenue growth rate. I don't have the numbers in front of
me, but my impression is that LinkedIn's revenue growth, while substantial, is
not in the stratospheric territory that Google's was.

(There's profit to consider too, of course, but the business models of these
two companies are similar enough that one would expect them to have similar
margins.)

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akkartik
Turns out linkedin doubled revenue YoY.
<http://techcrunch.com/2011/01/27/linkedin-files-for-ipo>

Google (gross revenue) was at 3x.
[http://www.sec.gov/Archives/edgar/data/1288776/0001193125041...](http://www.sec.gov/Archives/edgar/data/1288776/000119312504142742/ds1a.htm)

All this is details. It's pretty clear that prices aren't crazily inflated.

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anargeek77
LinkedIn were played here. That valuation was insane they reminded me of those
tech companies like Excite who went down the drain. On the other hand
Facebook's strategy was really conservative and wise for not going public yet.

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jacques_chester
Facebook can raise a billion dollars over lunch at this point.

Apart from the onerous reporting requirements once you go north of 500
shareholders, I don't see why they would bother to go public unless a very
large shareholder started pushing for it. And even then it seems possible to
unload multi-centimillion chunks in private exchanges.

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daydream
I'm sure all their large investors are pushing for it. Given the, uh,
irrational exuberance we're seeing, they may well get more for their stake in
a very liquid market, and it probably easier to buy or sell in public rather
than on the secondary market.

