LinkedIn, which reported better-than-expected first-quarter results in May, may see some foreign currency headwinds this quarter, as approximately 20% of its revenues come from Europe. Citi rates LinkedIn shares "buy" with a $125 price target.
Despite clouds of economic uncertainty in Europe, though, growth in the U.S. is still strong, albeit decelerating. "In the U.S., growth in the average number of Unique Visitors to LinkedIn decelerated to 15% Y/Y in Q2TD vs. Q1's 22% Y/Y increase, 'tho comps are tougher by about 25-pts - a thus largely positive trend, in our opinion," Mahaney said in his note.He did note that engagement amongst users is up, as Total Minutes, Page Views, and Site Visits experienced accelerating growth in the quarter. Job postings are also on the rise, increasing about 24% sequentially. "All in, we'd characterize such job postings growth as a neutral to positive read-thru supporting our revenue growth assumptions." Analysts polled by Thomson Reuters expect LinkedIn to earn 16 cents a share on $216.08 million in revenue. The company will report its second-quarter results on Aug.3. LinkedIn has only reported quarterly earnings three times since going public. "We note that since LNKD reported Q1 EPS, shares are down 7% (from May 4th to July 9th), vs. a 1% increase in the S&P 500 over the same period," Mahaney wrote. He believes expectations are muted going into the earnings report. LinkedIn shares have jumped 66.97% year-to-date, the best among the group. LNKD data by YCharts
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