(Sharecast News) - Stocks were mixed in Asia at the end of Thursday, as investors mulled fresh data including slowing economic growth in South Korea. Asia report: Stocks mixed as GDP growth slows in Korea Thu 27 October 2022 11:30.(Sharecast News) - London stocks were in a mixed state by the close on Thursday, with the top-flight index underpinned by well-received results from Shell, as investors digested a fresh rate hike from the European Central Bank. London close: Stocks finish mixed after ECB rate hike Thu 27 October 2022 14:31.(Sharecast News) - Wall Street stocks traded mostly higher early on Thursday as market participants braced for quarterly numbers from more of the nation's biggest names in technology. US open: Dow advances more than 460 points at the bell Thu 27 October 2022 14:42.(Sharecast News) - European shares were mostly higher on Thursday even as disappointing results from Facebook owner Meta weighed on investor sentiment globally. Europe close: Shares edge higher as ECB hints at smaller interest rate hikes Thu 27 October 2022 18:16.(Sharecast News) - Wall Street was mixed at the close on Thursday, with the Dow stronger on GDP data, while the Nasdaq was under pressure from some disappointing big tech earnings. US close: Stocks mixed as industrials shine, big tech tanks Thu 27 October 2022 22:19.Now that sales aren’t growing as fast, the excitement has evaporated and reality has set in.Īs of this writing, Chris Fraley did not hold a position in any of the aforementioned securities. The strong sales growth helped keep it afloat until early last year. Initial excitement for LinkedIn, a company most investors knew and many used, helped the stock nearly triple in its first two-and-a-half years after going public. So unless you’re looking to make a quick buck in the next few weeks, don’t add LNKD to your long-term portfolio. Still, the long-term trend is troubling, lumping LNKD in with the likes of the downtrodden Twitter ( TWTR) rather than crowd-pleasing Facebook ( FB). The 40% gap down isn’t likely to stick for a company with growing sales and earnings. LinkedIn will likely bounce back a bit in the days ahead. It’s now well below its 200-day moving average. What’s more, LinkedIn’s stock hasn’t traded above its 50-day moving average in two months. This is a turning point for LinkedIn stock, as the focus on LNKD’s negative guidance proves the bears have full control these days. Especially considering that Q4 non-GAAP EPS of 94 cents and sales of $862 million exceeded expectations. That said, the 33% overnight drop into the 40% morning decline seems like a gross overreaction. Within an hour of that close, LNKD stock was down 49% from those February 2015 highs. Shares were down 29% from their year-ago peak reached when the market closed on Thursday. LinkedIn stock has been trending downward for more than a year. As that growth dwindles, so does the appeal of LinkedIn stock.įurthermore, it’s difficult to reverse an investment trend once it starts to pick up steam. But with profits perennially up and down, better-than-average sales growth has long been LinkedIn’s calling card. Not that it’s abnormal most companies see sales growth slow as they mature. In 2013, LNKD’s sales growth dipped to the 50% range. However, 28% is sales growth is paltry compared to the triple-digit growth in 2011 and the 86% growth in 2012. The real problem is its sales: If LinkedIn’s guidance is correct, the $820 million in revenues would mark growth of 28% from the first quarter of 2015 - certainly nothing to sneeze at. So the disappointing EPS guidance is nothing new. LinkedIn’s earnings have routinely been all over the map since going public in May 2011. LinkedIn Stock’s Dilemma: Declining Sales Growth Further, EBITDA guidance for $190 million trailed the average estimate of $213.9 million. That’s well shy of the Street’s estimates for 75 cents per share on $868.3 million. The company expects non-GAAP per-share earnings of 55 cents on sales of $820 million in the current quarter. While LNKD actually had a solid fourth quarter - sales and earnings topped the consensus - weak guidance for Q1 and the full-year was its undoing. Shares of the online social networking site for professionals are down more than 40% in Friday morning trading. After Thursday’s disastrous earnings report, LinkedIn stock doesn’t look all that overvalued anymore. For years, crusty old value investors have hammered LinkedIn Corp ( LNKD) for its overvaluation.
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