LinkedIn, which opened trading on the New York Stock Exchange at $45 a share May 19, watched its shares double as the company seeks to ride the social media coattails of Facebook's success.
LinkedIn (NYSE:LNKD), which opened pricing for its initial public offering
at $45 per share May 19, watched its shares more than double on the New York Stock Exchange May 19.
As of 10:30 EST, LinkedIn' s stock traded at $85.90 a share under the ticker symbol
For the IPO, A total of 7.84 million shares are being made public,
according to a company statement
. Some 4.8 million shares are being offered by LinkedIn, with the remaining 3 million-plus
shares offered by stockholders looking to sell.LinkedIn is a professional social network that lets its
100 million users in more than 200 countries list their resumes and connect with
colleagues and recruiters. The company makes money from premium subscriptions,
advertising for businesses and hiring services for recruiters.
While social media software has become a lucrative growth sector in the
last half decade or so, LinkedIn's IPO pricing and valuation surprised some industry watchers.
With more than 100 million users, LinkedIn has a solid network
of professionals hawking their talents, but the company only made $15.4 million
last year on $243 million in revenue.
Silicon Alley Insider explained
the reasoning behind the IPO pricing, as well as what Wall Street
really expects from the company.
LinkedIn has warned in a regulatory filing that its
growth rate will slow as the company boosts spending on technology.
LinkedIn's worth is a pinch compared to Facebook, which
is certainly a LinkedIn rival as professionals and potential employers
certainly connect on the social network of 600 million-plus users.
Facebook has racked up
1.5 billion in funding
to date from Goldman Sachs and Digital Sky Technologies. However, most
expect that investment to pay off exponentially, with social
advertising booming and Facebook's
"Like" button spreading across the Web.
Some experts expect the
company to file an IPO by April 30, 2012, when it will have to disclose its finances under SEC rule.
When Facebook does go public, it will easily dwarf LinkedIn's net
worth. Still, LinkedIn's opening has to be stunning for those analysts
who openly questioned the company's worth.