Why not get social with LinkedIn?
LinkedIn Corp (NYSE:LNKD) is looking like the social media winner of 2013, climbing to a 52 week high on March 13 of $179.27. It recently partnered up with Intuit Inc. (NASDAQ:INTU), which is another name I like, especially during tax season, to help small business with their first hires. Both will be offering discounts on software and hiring packages. This is a match made in heaven, with LinkedIn as the largest professional social network and Intuit as a leading business and tax software provider.
The Street seemed to like this more for LinkedIn, but LinkedIn has one of those P/Es that’s hard to defend at 933x earnings. It drops down to an 85.78 forward P/E. Nonetheless, the stock has soared 91% over 52 weeks and its recent purchase of Pulse, a news feed, for $50 million will probably compete favorably with Facebook Inc (NASDAQ:FB)’s improved News Feed design. The company just reported much better than expected earnings and has no debt. Analysts predict an extraordinary 60% five year EPS growth rate for LinkedIn.
A taxing choice for value
Intuit gives the most value for the investing buck with a 1.00% yield and a forward 17.53 P/E. This name is only up 11% over 52 weeks. It reports again on May 21 after its all-important tax season.
Intuit is the slowest grower among these three at an expected 13% five year EPS growth rate. However, it has its portable credit card reader and mobile payment system, Go Payment, that competes with eBay Inc (NASDAQ:EBAY)‘s PayPal and privately held Square, which doesn’t seem to be reflected in earnings estimates.
Intuit is undoubtedly going to benefit from the taxing (pun intended) problem H&R Block, Inc. (NYSE:HRB) has been suffering with–delayed refunds. With a more reasonable PEG of 1.46, Intuit is much more a value than these social media giants. On a day when Oracle Corporation (NASDAQ:ORCL) spontaneously combusts after earnings and brings a host of similar names with it, Intuit hangs tough.
The Bottom Line
This new Facebook “likes” study just adds another privacy concern over possible abuse, but the main issue is users getting sick and tired of ad bombardment and profile manipulation. The younger users will mature and go to LinkedIn when it’s time to move out of the basement and get a job.LinkedIn is rich on valuation but it’s taking steps to become more valuable for its customers, rather than Facebook’s using their users to enrich advertisers.
Intuit’s partnership with LinkedIn is natural and adds value to both companies. Intuit is the value name here, but LinkedIn has the growth.
And yes, I “like” Stephen Colbert and curly fries.
The article What You Like On Facebook Could Change Your Life originally appeared on Fool.com and is written by AnnaLisa Kraft.
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