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Nomura Says Buy Shares Of LinkedIn

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Nomura Says Buy Shares Of LinkedIn

  • The share price of LinkedIn Corp (NYSE: LNKD) has appreciated 33. 69 percent over the past three months, reaching a high of $249.82 on December 1.
  • Nomura’s Anthony DiClemente initiated coverage of the company with a Buy rating and price target of $290.
  • Despite the recent surge in the share price, the stock has underperformed its Internet peers in 2015, and DiClemente believes that there could be upside potential to the stock valuation.
  • Analyst Anthony DiClemente mentioned that LinkedIn benefits from the “scale of data” it garners from its about 400 million members.

    “With upgraded products including a new mobile app and an upcoming improvement to LinkedIn Recruiter, LinkedIn is poised to successfully leverage its scale advantage across three key segments,” DiClemente also noted.

    Related Link: LinkedIn Stock Now Deserves A Higher Multiple, Says MKM's Sanderson

    Hiring Solutions

    For the Hiring Solutions business, DiClemente believes that there could be increased adoption of the revamped production line, along with additional penetration into smaller enterprises. Revenue growth in this segment inflected recently, indicating acceleration in revenue for the first time in five years.

    According to the Nomura report, “A refreshed Recruiter product in 1Q16, penetration of the SMB market, and upselling of Media and Jobs products should support 25+ percent revenue growth for Hiring in the coming years.”

    Marketing Solutions

    For the Marketing Solutions segment, new mobile apps were expected to drive higher engagement, which in turn would drive success for Sponsored Updates. “LinkedIn’s release of its upgraded flagship app drives our optimism for rejuvenated success of the advertising business,” DiClemente stated.

    In addition, DiClemente expects LinkedIn to leverage premium Lynda content in its Learning & Development business, to drive revenue growth for Talent Solutions.

    “We expect this to continue, owing to the synergies between Lynda’s high-quality content and LinkedIn’s enterprise customers, as well as its professional user scale,” DiClemente added.

    Image Credit: Public Domain

    Latest Ratings for LNKD

    DateFirmActionFromTo
    Jul 2016CitigroupMaintainsNeutral
    Jun 2016RBC CapitalDowngradesOutperformSector Perform
    Jun 2016UBSDowngradesBuyNeutral

    View More Analyst Ratings for LNKD
    View the Latest Analyst Ratings

     

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