RBC Capital's Mahaney Reiterates Bullish Stance on LinkedIn (LNKD)
RBC Capital analyst Mark Mahaney reiterated an Outperform rating and $275 price target on LinkedIn (NYSE: LNKD) following better than expected Q2 results, but lowered organic H2 guidance, citing ongoing weakness in its high-margin Display Advertising segment.
The keys to the quarter, according to Mahaney: 1) Lynda – Management raising FY15 contribution from Lynda to $90MM from $40MM, citing lower deferred Rev writedown, early close (mid-May) and slight over-performance. 2) Top-Line Deceleration – ex-Lynda, Talent Solutions grew only 32% Y/Y, decelerating from 36% last Q while Marketing Solutions/Premium Subs both decelerated 6pts. 2) Metrics Solid – Registered Members of 380MM beat the Street’s 378MM estimate, growing 21% Y/Y while Corporate Customer adds of ~2.7K beat the Street’s 1.7K estimate. 4) Sponsored Updates Shine – Doubled Y/Y and now accounts for almost half of Marketing Solutions.
The firm's 2015 Revenue/EBITDA rise 1%/5% while 2016 estimates largely unchanged.
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Shares of LinkedIn closed at $227.15 yesterday.