LinkedIn Corp.’s shares more than doubled in their public trading debut Thursday, evoking memories of the investor love affair with Internet stocks during the dot-com boom of the late 1990s.
Shares of the online professional social networking company closed at $94.25 US, 109 per cent above their $45 initial public offering price. They rose as high as $121.97, in their first day of trading on the New York Stock Exchange.
Just two weeks ago, LinkedIn’s proposed price range for the IPO valued it at just over $3 billion. Less than a decade ago, the company was nothing more than an ambitious idea and a computer in one man’s living room. Now, its $8.9-billion market value makes it larger than Harley Davidson Inc. and Moodys Corp.
“It seems to bring back memories of the tech bubble,” said Jack Ablin of Harris Private Bank in Chicago. “Based on what I know it seems like investors are a little overly enthusiastic.”
LinkedIn is the first prominent U.S. social networking company to publicly test how hungry investors are for social media companies such as Facebook, Groupon, Twitter and Zynga.
Like Facebook, Mountain View, Calif.based LinkedIn allows users to create profile pages displaying a picture and details about themselves.
While Facebook often has more informal profiles that may include a photo album from a recent trip, for example, LinkedIn is seen as the place for a professional persona. The profile pages are basically an online database of electronic resumes.
The company’s 2010 net income was $3.4 million attributable to common stockholders on net revenue of $243.1 million.
As of March 31, LinkedIn had 1,288 employees and 102 million registered members. Based on LinkedIn’s current market worth, each of those users is valued at about $96
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