NEW YORK (
) has been reiterated by TheStreet Ratings as a sell with a ratings score of D. Among the areas we feel are negative, one of the most important has been premium valuation based on our review of its current price compared to such things as earnings and book value.
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Highlights from the ratings report include:
- Compared to other companies in the Internet Software & Services industry and the overall market, LINKEDIN CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for LINKEDIN CORP is currently very high, coming in at 86.70%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, LNKD's net profit margin of 2.60% significantly trails the industry average.
- Net operating cash flow has significantly increased by 138.03% to $63.22 million when compared to the same quarter last year. In addition, LINKEDIN CORP has also vastly surpassed the industry average cash flow growth rate of 15.25%.
- LINKEDIN CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, LINKEDIN CORP increased its bottom line by earning $0.11 versus $0.06 in the prior year. This year, the market expects an improvement in earnings ($0.69 versus $0.11).
LinkedIn Corporation operates an online professional network. The company has a P/E ratio of 702.3, below the average internet industry P/E ratio of 877.8and above the S&P 500 P/E ratio of 17.7. LinkedIn has a market cap of $6.57 billion and is part of the
industry. Shares are up 67.2% year to date as of the close of trading on Wednesday.
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--Written by a member of TheStreet Ratings Staff.
TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.