I don’t see the same level of innovation and differentiation at LNKD to make that kind of growth possible. Investors in LNKD are betting on the company becoming significantly larger than Google is now. For comparison, Google (GOOG) had $50 billion in revenue and $11 billion in NOPAT in 2012. If LNKD actually grew by that much, it would have $800 billion in revenue and nearly $30 billion in NOPAT. To justify a valuation of ~$240/share, LinkedIn must grow after tax profit ( NOPAT) by 30% compounded annually for 24 years. I focus on LinkedIn’s need to monetize its network because the valuation of its stock implies the company will do so at rather astounding levels.Įven if you believe LinkedIn will monetize its network, I think it is hard to make a straight-faced argument that it will do so to the degree already baked into its stock price. Given its competition and the lack of substantive value-add to its members. The company must monetize that following. Success for LinkedIn requires more than just building a big following. There are too many sites already serving as aggregators of content for LNKD to really achieve a dominant position in this space. The company is trying to package the content of its members and serve as a news aggregator as well, but in both cases the site just serves as the platform for someone else’s content.
Most of LinkedIn’s utility comes from access to its members and their contributions. More specialized sites that cater to professionals in specific industries could potentially take a bite out of LNKD’s user base. There are at least 20 other sites offering similar services. LNKD is the biggest social media site for professionals, but it far from the only one.
LNKD also faces significant competition as a tool for professional networking. It doesn’t appear that LNKD has a major advantage in this space. Smaller companies such as Monster Worldwide also have many users. The discount will be applied to the lower of either the price of NVIDIA stock set at the beginning of your offering period or its price at the end of the purchase period.įull ESPP eligibility requirements and terms are contained in the ESPP Prospectus and Plan documents available on NVINFO's Stock Administration site under "Reference Materials.While LinkedIn certainly offers a useful service and boasts an impressive user base, it has a number of formidable competitors in the fields of professional networking and publishing.įacebook and Twitter both offer a multitude of apps and tools to help potential job seekers, and their user bases significantly exceed LinkedIn's. Your contributions over each period will purchase our shares at a 15 percent discount. Your offering price for NVIDIA ESPP gets set the first trading day after the month you’ve enrolled, and it remains the look-back price for up to 24 months.ĭuring these two years, there will be four purchase periods.
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