BMO Capital Markets Upgrades LinkedIn
Daniel Salmon, analyst at BMO Capital Markets Group upgraded shares of LinkedIn (NASDAQ: LNKD) from Market Perform to Outperform with a $270 price target, increased from $235.
“We believe there are several new stories emerging that will raise long-term growth expectations; in particular, we believe LinkedIn is preparing to formally launch in China,” Salmon noted in an equity research report.
The analysts believe that the company can launch in China in 2014 while monetization opportunities will ramp in 2015. Management has discussed expanding to China in the past but the analysts noted the company retaining one of its public relations agencies for work in China. The vast size of the Chinese market coupled with a customized version of the social networking platform could “yield valuable benefits” according to Salmon.
The analyst also noted that the company is working on a stand-alone product/platform for salespeople that will be released towards the end of 2014 based on the already existing size of the market that could be heavily monetized. “LinkedIn is not yet offering a total addressable market assessment for these users, but noted that there are 6x as many salespeople on LinkedIn as there are human resources professionals,” Salmon noted.
Other platforms that the company is working on include a platform the student market and University Pages. At this time there is no specific monetization products that could drastically alter the bottom line, however the push to new platforms should increase the user base and engagement.
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