LinkedIn Prices

Linkedin

Linkedin

 

Yesterday, LinkedIn (LNKD), the online professional networking service, priced a secondary offering of 8.8 million shares at $71 per share after reporting its first quarterly loss since its IPO back in May 2011.

So let’s review some numbers here because I am having a tough time with this one.

As of September 30, the company’s last 12-months (LTM) Revenues were $435MM and LTM Net Income of just over $10MM.    With add-backs from depreciation and amortization the company generated Earnings-before-interest-taxes-depreciation-amortization (EBITDA) of about $25MM.

LinkedIn’s May IPO raised $352.8 million for the company ($248 million in net proceeds) and and as of September 30, the company still has $387MM in cash and short-term on its balance sheet and no real debt.

LinkedIn offers three major products

  • Hiring Solutions: Revenue derived primarily from the sale of LinkedIn Corporate Solutions and LinkedIn Jobs products, selling LinkedIn Jobs on their website to enterprises and professional organizations.
  • Marketing Solutions: Revenue  derived primarily from fees received from marketers, principally advertising agencies, direct advertisers and user created ads that are displayed on their website.
  • Premium Subscriptions: Revenue  derived primarily from online sales of our Business, Business Plus and Executive subscription products. These are monthly
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Should You Leverage The S&P 500 In Your Portfolio

SPY ETF

 

Recently I sat down to think of possible improvements that I can make that will enhance the performance of my retirement investment portfolio.  Like most people, I have significant exposure to the greater U.S. equity markets with approximately 45% of my portfolio invested in large capitalization equities, which are components of the S&P 500 Index.

S&P 500

The S&P 500 Index tracks the combined performance of the 500 largest companies in the U.S.  So, buying a share in a mutual fund or Exchange-Traded Fund (ETF) that has an investment mandate to mirror the S&P 500 will give you returns equal to the index, less any fees and expenses related to managing the portfolio.  In other words, if I hear someone say “the S&P 500 went up 2% today”, then it is highly probable that about 45% of investment portfolio increased in value by 2% as well.

Now, I am quite certain that for the foreseeable future my portfolio will continue to have significant S&P 500 Index exposure.   Therefore, whether I know it or not, I am effectively saying, “I believe that investing in an S&P 500 Index Fund is going to give me the necessary long-term returns to fund a significant … Read the rest

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