LinkedIn's Growth Is Already Priced In: Analyst

By Jennifer Leigh Parker, Writer, CNBC.com

NEW YORK (CNBC) -- Despite its blockbuster earnings report, now is not the best time to buy LinkedIn(LNKD), according to Ken Sena, analyst at Evercore Partners.

"The story itself is a great one. You continue to see shares gains and margin expansion, but I think the stock is trading six times its 2013 revenues," he said. "Even assuming they stay on course, a lot of that upside is already in the stock at this point."

And there is a lot of upside. The shares are up 89% since its IPO in May 2011.

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The networking site's fourth-quarter results came in far ahead of estimates, earning 12 cents a share, up from 5 cents a year ago and nearly double the 7 cents a share expected. Revenue also more than doubled from the year ago quarter, coming in at $167.7 million.

Behind the numbers, LinkedIn has been able to corner the strictly business brand that competitors like Facebook and Groupon(GRPN) have not.

Indeed, it is not "friends," but revenue from companies that made the most impact on revenues; which grew 136% in the past year to $84.9 million from recruiting alone.

"I think people using LinkedIn are putting up a very professional 'self,' and so companies feel much more comfortable using LinkedIn versus Facebook to target employees," said Sena.

Job seekers are taking notice. The site added 14 million new profiles last quarter, bringing its total to 145 million.

"When times get tough, we see a number of people turning to LinkedIn for help," said CEO Jeff Weiner in a separate CNBC interview Friday. "And from a hiring solutions perspective, we're unique."

Still, as a value investor, it may be difficult to justify a "buy" rating on a stock at six times revenues, and around 760 times earnings -- even for a very young company.

Weiner responded, saying: "We leave the valuations to the marketplace. We focus on the fundamentals. We'll let the valuation take care of itself."

--Written by Jennifer Leigh Parker at CNBC.com

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