LinkedIn, Down 17% Year To Date, May Offer Stronger 2H Outlook

LinkedIn (NYSE: LNKD) shares are down 17.5 percent year to date and when the company posts results Thursday, investors will look for signs of a slow-down in revenue growth as well as how markets in Asia are shaping up.

CEO Jeffrey Weiner wants to see membership grow to more than 300 million.

Following its most recent quarterly report, shares tumbled on a weak outlook. But Wunderlich's Blake T. Harper thinks the second-half guidance will be looking up. He expects strong results in key segments including talent solutions, marketing solutions and mobile sponsored updates.

Although shares have been hurt by recent, outsized investments in research and development of new products, “investor sentiment is likely to rebound” on second-quarter results, and the outlook for the year's second half, Harper said in a recent note.

Sterne Agee's Arvind Bhatia said investors want to know if and how a recent re-acceleration in membership growth is sustainable.

The company has made two acquisitions in July alone, agreeing to pay $175 million for a business-to-business marketing company called Bizo for about $175 million. It also acquired Newsel, a consolidator of news, for an undisclosed price.

Cantor's Youssef Squali thinks LinkedIn's second quarter will meet or slightly beat the consensus, with double-digit growth across all three of its business segments: Talent Solutions, Marketing Solutions and Premium Subscriptions.

Given the company's large markets, established business model and emerging opportunity in generating sales leads, “we're positive on the stock,” Squali said in a research note reiterating a Buy recommendation.

Analysts expect adjusted earnings of $0.39 per share on revenue of $511.2 million, up from year-earlier adjusted earnings of $0.31 per share on revenue of $363.7 million.

LinkedIn traded Tuesday morning at $178.78, up 0.44 percent.