short int at 21 days. end of day short covering will cause stock to pop another few points?
Stuart, I'm not sure what a short interest is, but suspect it means you're playing the same side of AOL I am with my Apr20 puts. With that admission, you know I'm a novice, so take the following accordingly:
It never ceases to amaze me just how adept AOL is at putting a positive spin on each incoming bullet. I feel very deeply that they *should* be as high as they are now, yet they show an amazing resistance to moving down. Personally, I see AOL as a very tenacious zombie.
This amazement set aside, I just can't see any way they can possibly come out of this without taking a huge beating (below $20 per share, if not completely out). The other shoe has yet to fall. Or, should I say "shoe store".
As far as I can tell, this settlement "in principal" has no bearing on any of the other numerous lawsuits against them, and I believe that frustration at getting relief via fax, snailmail, or telephone will only bring up more of them. The AGs may even go back after them for not complying with the agreement.
The fact also remains that their planned addition of 150k lines (last number I read) is far too little and way too late, although this isn't public knowledge yet. Heck, I doubt seriously they can even afford to do the proposed upgrades.
Also, there's the suit filed in Florida over content (I don't think it's got that good a chance of flying, unless there's an awful lot of evidence of AOL being negligent -- according to most similar suits against BBSes, providers are not liable for content they didn't create). However, the suit brings up another point. As this giant falls, you can bet lots of folks will be trying to get their own piece of him before he's a useless carcass.
I'm sure there are other shoes prepared to drop that I haven't even considered yet. What kind of shape are the company's coffers really in, for example? From what I've seen, it looks like it'd possible to completely bleed this company in less than 60 days.
So, my take is that they're definitely going down, but I think it will still take a while. Given their ability to stand up to these punches so far, it's entirely possible they'll even be *up* in 3 weeks, but I seriously doubt it. I'm expecting $30 very soon. If this thing wavers at all from where it's at now, I expect it to drop pretty quickly. |
