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5 Social Networking Stocks to Watch

Stocks in this article: AMZN LNKD GOOG SINA RENN DELL MMI

NEW YORK ( TheStreet) -- A look at the top social networking Web sites shows that Facebook reigns, with more than 800 million active users, while professional social network LinkedIn (LNKD) accounts for more than 120 million visitors worldwide. Twitter grabs the third spot, with more than 100 million users; the new Google plus (GOOG) comes in fourth with 20 million users.

Visitation to these Web sites is rising as social networking through mobile networks is climbing; it is estimated to exceed 550 million in 2011, and triple to 1.7 billion by the end of 2016. Analysts polled by Bloomberg foresee potential upside of 8% to 60% for these stocks, with buy ratings of 52% and hold ratings of 39%.

Below, the stocks are listed in ascending order of potential upside based on analysts' price targets.

5. LinkedIn is a professional social network with more than 120 million users across 200 countries and territories. Through this site, people can create, manage and share their professional identity online.

For the second quarter, subscriptions increased 61% from the year-ago quarter to 115.8 million members. Also, page views grew 80% to 7.1 billion from the second quarter of 2010. Revenue for the quarter increased to $121 million, up 120% from the year-ago quarter. Net income increased to $4.5 million from $4.3 million earlier.

LinkedIn recently announced reaching more than one million professional members in Belgium. Additionally, the professional network is expanding its presence in Germany by opening its first office in Munich. The office would support the company's growing membership of more than two million professionals across the German-speaking markets.

For the 2011 third quarter, revenue is estimated to range between $121 million and $125 million. Adjusted EBITDA is forecast between $9 million and $11 million. Revenue for the full year is expected to range from $475 million to $485 million, while adjusted EBITDA is projected between $65 million and $70 million.

Of the 10 analysts covering the stock, 30% recommend a buy and 50% rate it a hold. Analysts surveyed by Bloomberg forecast an average 12-month price target of $87.60, nearly 11.3% greater than the current price.

Note: Potential upside is based on analysts' price targets.

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