The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.



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is working in the right direction as its number of registered users is increasing and it continues to benefit from several product initiatives launched in past several months. The company continues to target smaller business customers that can leverage the growing user base to attract talent as well as use LinkedIn as an effective tool for branding and other promotional activities.

As the number of small business customers increases, we expect revenue per business customer will decline in the medium term since LinkedIn will receive lower fees from the smaller customers. However, this can be offset by more job postings with higher number of clients, and this should grow its top line further. LinkedIn mainly competes against





in the online job search market.

Our complete analysis for LinkedIn's stock is here.

The number of registered users on LinkedIn grew to more than 130 million by the end of Q3 2011 at a growth rate of 60% y-0-y, attributable to greater visibility and user engagement tools developed by the company. With a rich and diverse user base, companies can reach out to a wider group and attract the best talent. This gives LinkedIn an opportunity to charge more as the number of registered members increases in the long term.

Despite the persisting unemployment rate of around 9%, there are still 3.4 million jobs available as of September 2011, according to Bureau of Labor Statistics.

This situation favors LinkedIn, which offers a unique platform for professional networking where employers and potential employees can interact and communicate. The company also saw increased visibility when it

hosted President Obama's ambitious $447 billion Jobs Act back in September.

LinkedIn is trying to attract more small businesses in order to increase its customer base as well as promote more job growth. Though LinkedIn will earn lower fees from these small businesses, higher number of customers should increase the total number of job postings, which should in turn boost its overall revenues.

We currently have a

Trefis price estimate of $42.87 for LinkedIn's stock, about 70% below the current market price.



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This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.