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LinkedIn: Time to Get Bullish on This Rising Star?


With 200 million professional contacts, LinkedIn is one of the most-followed companies on the market.

On May 2, LinkedIn (NYSE:LNKD) will announce earnings for Q1 of 2013. The company has beaten expectations every quarter for the past year and a half. Estimated earnings per share have evaluations as high as $0.41, compared to $0.35 of Q4. For annual revenues, the professional network brought in $927 million last year, up $450 million from 2011.

With 200 million professional contacts, LNKD is one of the most-followed companies on the market. The stock has increased 78% over the last year with no signs of slowing down as sales and net income keep growing. The company is considered to have a strong business model with a strategy that can market to different segments of its customers. LinkedIn is comprised of both free and paid features for its members, and currently it has partnerships with developers such as BlackBerry (NASDAQ:BBRY) to make those experiences even better.

As other social media platforms like Facebook (NASDAQ:FB) begin to see a drop in users, LNKD is only experiencing higher demand by offering services with career-enhancing potentials. Demand for online presence is becoming more critical to all demographics, and LinkedIn is the only available platform to bridge that gap.

With more opportunities to grow in the mobile ad arena this year, the forecasts for annual revenue stand at $1.5 billion.

I want to get bullish LNKD, but not aggressively, so I want to buy LNKD on a pullback.

Trade: Selling the LNKD June 185-175 Put Spread for $3.20
Risk: $680 per 1 lot
Reward: $320 per 1 lot
Breakeven: $181.80

Greeks of this Trade

Delta: Long
Gamma: Short:
Theta: Long
Vega: Short

Disclosure: Minyanville Studios, a division of Minyanville Media, has a business relationship with BlackBerry.
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