Linked In IPO

Lots of chatter on the LinkedIn IPO from "is this another dot com bubble?" to "is now the right time to buy?", to "how can they support an $8 Billion valuation if they plan to lose money in 2012?".

Jeff Weiner appeared on the floor of the NY Stock Exchange this morning with CNBC, and was asked all of these questions and more. He simply said... "the market will pick the value, and we're just focused on the three core business'." They have 3 lines of business including advertising revenue, recruiter services, and subscriptions for advanced services by indv users. I think the big win for LinkedIn over time will be the recruiter services, and in-house recruiting tools they're offering to business'. With recruiter fees being very expensive, many companies are seeking lower cost, efficient tools to help them staff up.

Being a bull, I feel the economy is on its way to recovery, and thus hiring will be a huge pain point for business in 2011 - 2015. LinkedIn helps to reduce this pain point, and thus will benefit from a robust economic recovery. (even a modest one).

So, if you believe that LinkedIn is a strong investment, as I do, how do you buy. Well, hindsight will be best, but my IPO experience tells me to buy during the "quiet period", which is historically 30 days following the IPO date. Shares tend to drift downward after the first day of trading, and usually land somewhere near the strike price. (in this case $45).

So, buy LNKD @ $45 per share if you like the company.