Putting LinkedIn’s Price Into Context

How expensive are shares of LinkedIn ($LNKD)?:

Surging demand for social-media stock and a comeback in venture-capital IPOs propelled LinkedIn to a high of $122.70 in its first day of trading from an initial price of $45. With a market value of $8.45 billion, the company must boost revenue by 148 percent a year, twice its growth rate since 2009, to bring its price-sales ratio in line with the Dow Jones Internet Services Index by 2013, Bloomberg data show.

“This is not something we even consider investing in,” said Haverty, who helps oversee $35 billion in Rye, New York. “This is a sideshow. It’s a magic show,” he said. “The only question for the investor is how soon they should sell.”

I think when most people say “this time is different,” they really mean, “this time is different because now I own the stock.”

Posted by Eddy Elfenbein on May 24th, 2011 at 2:01 pm

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