Even its underwriter has dumped the company, JPMorgan Chase (JPM) only owns 2.6 million shares compared to the 6.7 million it owned in January of 2012. Even the JPMorgan analyst can't decide if he likes it and has flip-flopped on the rating. Zynga is now throwing its efforts at gambling. Zynga is becoming the Lindsey Lohan of internet stocks. It's gone from squeaky clean Farmville and Draw Something to the less respectful world of online gambling. A starlet with promise going down to the dark underbelly of the internet world.
One stock from the internet rat pack that hasn't gotten as much media attention is LinkedIn (LNKD - Get Report). The company will report its earnings on February 7th and the stock's star power is climbing in advance. Analysts have big expectations for LinkedIn's next quarter with estimates nearing a 41% increase in earnings. LinkedIn is taking share away from Monster Worldwide (MWW - Get Report)as it becomes the go-to site for job-seekers. A comparison of LinkedIn's 200 million users versus Facebook's billion may be keeping the loud bulls away, but just look at the box-office draw and see the fans.
Option buyers are already betting on an increase in stock price with high activity for calls with a $120 and $125 strike price. The stock is currently trading near $117. The stock went public at $45, but in the first day it climbed to $84, and then slipped to the $60 range. During 2012 though, it found its fan base and the stock hasn't looked back since. Investors though should be aware that LinkedIn's price-to-earnings is a shocking 761, while Facebook's is only 164.
Investors are willing to pay a premium for LinkedIn because its revenue stream is steady and growing, while they aren't as convinced about Facebook, yet. However, tomorrow's event could change that. Investors may soon hit the Like button on Facebook. And then Facebook may say, like Sally Fields did at the Oscars, "You like me, you really, really like me."--Written by Debra Borchardt in New York.
>To contact the writer of this article, click here: Debra Borchardt. Follow @WallandBroad