The graphs below were produced by Capital Market Labs.
Over the last six months, LinkedIn Corp (NYSE: LNKD) is up 30 percent, while Facebook Inc (NASDAQ: FB) is up 18 percent and Twitter Inc (NYSE: TWTR), Yelp Inc (NYSE: YELP) and Google Inc (NASDAQ: GOOGL) all have negative returns. So, what makes LinkedIn special?
Let's take a look at seven different visuals with various peer groupings to find out.
The first chart will stay myopic to LinkedIn to examine the firm's revenue trend.
Check out the tenfold multiplication of revenue in just five years, growing from $200 million (TTM) to now over $2 billion (TTM).
In the next chart, still remaining myopic to LinkedIn, let's add cash from operations in red.
As revenue has increased, cash from operations has increased even more, going from $46 million (TTM) to now $521 million (TTM). There's no doubt that LinkedIn has realized enormous growth.
Now, let's turn to some peer comps. The chart below plots revenue for LinkedIn compared to Twitter and Yelp.
LinkedIn's trajectory is about the same as Twitter (exponential), but the numbers are simply larger.
Going further, let's plot this same peer group with cash from operations as the focus.
It's this image where the vast difference between these three firms become clear. LinkedIn is driving cash from operations; Yelp and Twitter are trivially positive compared to the company.
What about research and development?
LinkedIn is doing well there too. It exhibits a healthy and linear increase since 2012, while Twitter's spend is massive and wildly exponential of late.
Next, let's broaden the peer group to include all Internet Software & Services companies with market caps above $5 billion and examine gross margin percent on the y-axis with one-year total revenue growth on the x-axis.
While LinkedIn shows a robust 45 percent revenue growth year-over-year, it has the highest gross margin percentage of any Internet Software & Services company in North America in this market cap range.
In one final chart, let's examine valuation, and plot market cap on the x-axis and price-to-sales on the y-axis.
Interestingly enough, LinkedIn has the lowest price-to-sales ratio relative to these peers.
What does this reveal?
A firm that has outperformed all peers in the last six months, has realized a tenfold revenue boost over the last five years (and greater cash from operations growth), maintains a healthy R&D spend, has the highest gross margin percentage of any firm in its industry (above $5 billion in market cap), with a relatively low valuation.
That's what makes LinkedIn special.