America On-Line: will it survive ...? Message Board

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Technology Stocks : America On-Line: will it survive ...?

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To: Tim Kenney who wrote (4914)	9/26/1997 12:50:00 PM
From: Brent D. Beal	of 13594

*and now for something completely different...... Sep. 23-- "Robertson Stephens & Co. lowered the estimated per share earnings of America Online Incorporated for the fiscal year ending June 1999 to $1.65 from $2.00."* Holy sh--! A downgrade. This certainly comes as a surprise. I think your analysis of the situation is right on--we've seen this pattern time and time again. What I think is interesting about this case is just how blatant it's been with convenient reiterations of "strong buy" recommendations while top management is getting rid of their shares like used condoms. Another quarter or two with no earnings, a few negative articles that perhaps (I know this is a lot to ask) present a reasoned look at AOL's ability to attract significant revenue with so many other players now jumping in (CNET, Yahoo!, etc.) and this stock could will be in the 30s. What I think is amazing is how long this ruse has gone on. Today is the last reporting day for mutual funds--Since AOL has had such a nice run-up, I think funds are reluctant to sell since they want AOL's name to appear on their quarterly summaries. On Monday, however, the window dressing will be over and managers will want to fine tune their portfolios for performance. This is when the dumping will start. Given the low volume, think of what a 500,000 share sell could do? Just one major fund dumping their shares could drop this thing 3 or 4 points.

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