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LNKD IPO opens huge at $83

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Re: LNKD IPO opens huge at $83

#21

Post by portman »

blantonl wrote: post #5

LinkedIn made $15 million dollars last year, and they just raised $660 million dollars out of the gate in this IPO. And, this IPO values LinkedIn at somewhere close to 6.5 billion dollars. A valuation of 6.5 billion dollars on $15 million net income. Let that sink in.

>>*"they just raised $660 million dollars out of the gate in this IPO"

No, that's not how it works.

LinkedIn priced their IPO at $45/share, meaning they raised $352.8 million. The share price right now has no impact on how much money they raised.

Re: LNKD IPO opens huge at $83

#22

Post by monochromatic »

dman wrote: post #15
blantonl wrote: post #5

LinkedIn made $15 million dollars last year, and they just raised $660 million dollars out of the gate in this IPO. And, this IPO values LinkedIn at somewhere close to 6.5 billion dollars. A valuation of 6.5 billion dollars on $15 million net income. Let that sink in.

Might be a nice time to short, that is if there is someone willing to be on the other side of that trade.

There always is.

Re: LNKD IPO opens huge at $83

#23

Post by 3am »

blantonl wrote: post #5

LinkedIn made $15 million dollars last year, and they just raised $660 million dollars out of the gate in this IPO. And, this IPO values LinkedIn at somewhere close to 6.5 billion dollars. A valuation of 6.5 billion dollars on $15 million net income. Let that sink in.

Based on there IPO prospectus from sec.gov:

Year; Revenue; Costs; Income 2008; 78,773; 84,282; (4,522) 2009; 120,127; 123,482; (3,973) 2010; 243,099; 223,523; 15,385

expense growth is 46%, 82% yoy. revenue growth is 52%, 103% yoy.

So, you have a company that is growing revenue faster than expenses, has 100% year over year revenue growth, and has just hit the inflection point to be profitable... and you want to place a market average P/E on it?

Re: LNKD IPO opens huge at $83

#24

Post by [deleted] »

dman wrote: post #15
blantonl wrote: post #5

LinkedIn made $15 million dollars last year, and they just raised $660 million dollars out of the gate in this IPO. And, this IPO values LinkedIn at somewhere close to 6.5 billion dollars. A valuation of 6.5 billion dollars on $15 million net income. Let that sink in.

Might be a nice time to short, that is if there is someone willing to be on the other side of that trade.

[deleted]

Re: LNKD IPO opens huge at $83

#27

Post by nikcub »

mhp wrote: post #12
nikcub wrote: post #11

called it: http://news.ycombinator.com/item?id=2563481 should have put a lot of money on that. I think it will hit $18-20B market cap in no time

You couldn't have actually put a lot of money on it (unless you bet one of your friends, or in the unlikely case that you or your family member works for LinkedIn). The trick with IPOs is that even if you had the shares earlier, you couldn't sell them today because of the six month lockup period. The only way for you to get in would be right now at ~$80.

that is true if you want to directly purchase shares, but there were market makers and other outlets offering CFD's and derivatives at just above the list price.

judging by the volume (9M traded so far, which is more than what was listed) there seems to be a lot of that going on

Re: LNKD IPO opens huge at $83

#28

Post by [deleted] »

wladimir wrote: post #6
DocSavage wrote: post #4

Earlier quoted context omitted.

At times like this I'm tempted to short the stock, or at least wait a month or longer until there's sufficient shares to short and not immediately get squeezed. It's just that unlimited downside, investor euphoria on social networking, and volatility makes me too nervous to do it.

If the unlimited downside scares you, why not buy put options?

[deleted]

Re: LNKD IPO opens huge at $83

#29

Post by thematt »

monochromatic wrote: post #22
dman wrote: post #15

Earlier quoted context omitted.

Might be a nice time to short, that is if there is someone willing to be on the other side of that trade.

There always is.

Not always. There are some companies that don't have enough liquidity to effectively make that trade or have no investors willing to lend the shares. Not to mention shorting (or options) aren't even allowed yet on this particular stock.
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