BMO Capital: LinkedIn Still Worth $280/Share, Will Outperform The Market

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In a report published Thursday, BMO Capital analyst Daniel Salmon maintained an Outperform rating and $280 price target on
LinkedIn Corp.
LNKD
. The company is expected to begin testing its new Lynda products in 2H15, with a possibility that the products would be ready for commercialization in 2016. The company is currently evaluating potential pricing schemes the product suite. "There remains some investor confusion on the Talent Solutions sales re-organization," Salmon said, while adding that LinkedIn's management highlighted that "a) the "hunters" were unaffected; changes were entirely within the "farmer/relationship manager" group; b) the primary impact was on the upselling of job slots and recruitment media; the pipeline and renewals for Recruiter were largely unaffected, and; c) Europe was more affected than the US due it being a more SMB-driven market." The analyst does not expect the company to undertake any private exchange or major program-related on-ramp for Marketing Solutions to resolve the display weakness. Instead, the company is expected to continue "managing its ad load mix towards Sponsored Update units." The analyst believes that the company is able to charge for Lead Accelerator on a true subscription basis because users target long sales cycle buyers via this platform, "where thoughtful/consistent messaging trumps an immediate call-to-purchase."
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Posted In: Analyst ColorReiterationAnalyst RatingsBMO Capital Markets
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