LinkedIn (LNKD) Leading In Pre-Market Activity

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified LinkedIn ( LNKD) as a pre-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified LinkedIn as such a stock due to the following factors:

  • LNKD has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $867.2 million.
  • LNKD traded 17,548 shares today in the pre-market hours as of 8:07 AM.
  • LNKD is up 2.6% today from Friday's close.

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More details on LNKD:

LinkedIn Corporation operates an online professional network. LNKD has a PE ratio of 840.8. Currently there are 19 analysts that rate LinkedIn a buy, no analysts rate it a sell, and 14 rate it a hold.

The average volume for LinkedIn has been 2.6 million shares per day over the past 30 days. LinkedIn has a market cap of $20.0 billion and is part of the technology sector and internet industry. The stock has a beta of 1.34 and a short float of 4.2% with 0.89 days to cover. Shares are down 11.2% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates LinkedIn as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income and disappointing return on equity.

Highlights from the ratings report include:
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Internet Software & Services industry. The net income has significantly decreased by 67.1% when compared to the same quarter one year ago, falling from $11.51 million to $3.78 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. 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.
  • Compared to where it was a year ago, the stock is now trading at a higher level, and has traded in line with the S&P 500. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry, implying reduced upside potential.
  • The gross profit margin for LINKEDIN CORP is currently very high, coming in at 87.06%. Regardless of LNKD's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, LNKD's net profit margin of 0.84% is significantly lower than the industry average.
  • LINKEDIN CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, LINKEDIN CORP increased its bottom line by earning $0.23 versus $0.19 in the prior year. This year, the market expects an improvement in earnings ($1.51 versus $0.23).

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
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