Linkedln Ipo double
Reminiscing over the stock market frenzy of the 1990’s.
(LNKD) Linkedln IPO event has one huge similarity to the tech hype of the 1990’s…. it is the first big social network company to come public.
People are buying in right now, because of the hype, because they want to own one of the new social media companies, this is more of an emotional gut feeling and not a rational financial investment.
Investors should focus on fundamental. They should consider and questioned the business model, especially when trying to justify the explosive price, investors are willing to pay for shares of Linkedln. At 36 -37 times the estimated price per earning, this is clearly about supply and demand and not fundamentals.
linkedln yesterday IPO’s strong debut, will probably lead to other social network companies to go public, and I guess by now, that the private share holder of companies like Twitter, Facebook, Zinga, Groupons and many others are smiling and barely containing the excitement of knowing their turn will come soon.
Investors will need to be very selective and base their purchase upon fundamentals and well structured companies.
For the moment, Linkedln is on the rise and still gaining well over a 100 dollar a share, and for those riding the tide should be very cautious, cause, we all know what happens when the tide reaches the shore.