OpenTable: Blodget's analysis flawed

In a recent post about OpenTable's recent IPO, BusinessInsider CEO and former sell-side analyst Henry Blodget takes a straight valuation approach to the company. He concludes that growth of U.S. revenues is already slowing and that the stock is priced for perfection with forward price-to-earnings multiples in the 65x range for 2010 earnings.

If OpenTable (OPEN) were a run of the mill software or internet business, Blodget would be right. What he fails to account for is that OpenTable is actually a "network effect" business -- and U.S. growth could soar in the near future.