UPDATE: Citigroup Initiates Coverage on LinkedIn Corp. with Neutral Rating on Valuation

In a report published Wednesday, Citigroup analyst Mark May initiated coverage on LinkedIn Corp. LNKD with a Neutral rating. In the report, Citigroup noted, “Despite our bullish view of LinkedIn's top-line growth and margin expansion prospects, its asset/option value, its defensive network effect business model, its strong management team, and the potential for additional meaningful revenue streams, we are initiating coverage with a Neutral rating, primarily given the valuation, which we view as pricing in both the bullish outlook for the core Talent Solutions and Marketing Solutions businesses but also more upside potential from new and future initiatives than we're currently comfortable assuming. In addition to a more favorable entry point, we'd also look for an inflection in member engagement (a precursor to advertising acceleration), greater traction and/or visibility into the pace of adoption of Sales Navigator and/or greater than expected traction with new ad formats (e.g., News Feed ads) all as reasons to get more constructive.” LinkedIn Corp. closed on Tuesday at $189.34.