HI Arnie> Thanx &re >book value/AOL16 bit tcp/ip:BIG MARCH40 PUT
BET.
>Stockholders equity dropped from $512,502,000 on June 30 to $38,794,000 on
>December 31. Divide these figures by the 93,800,000 shares outstanding and discover the book value has decreased from $5.46 per share to 41 cents per
>share during the past 6 months.
>AOL still has $42,309,000 in "goodwill" listed as an asset. Subtract this and
>the figure becomes minus 3.7 cents per share. :-)
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As much as I'v taken A OFFLINE to task about their sorry and misleading accounting procedures..I didn't catch that $ 42,309,000 in "goodwill" being listed as an asset ! I like to see them try to sell it !
I have not yet personally found any one who has gotten a refund, let alone someone who can say they did and are satisfied with the refund. It's beginning to look like the Refund, is just a hoax to appease and put off frustrated customers who can't get on line.
Back to book value dropping..from 5.46 per share to .41 a share..
in one quarter that was bad enough....but it is true..we also have to take that so called "goodwill" out of the assert column to get a more accurate picture , her bottom line value has decreased not just the 92.4 % I had noticed..but has gone, to the negative side..and book value has decreased 107%..she sure is a candidate for bankruptcy, but I don't see that drama real soon, and for several reasons, to much to get into in this post, but basically I think she will be allowed to live long enough to put in some much needed improvements at her hub sights, this work is already underway, ( and most of it is being done on credit by a rival network ) this shapes up to "let them improve the system, we know they are not going to be able to pay us, but's let us do a good job, as the system will fall into our lap, meanwhile (1) we will get a better tax write off this way, (2) when we take it over it will be up to our standards and we won't have to try to play catch up with a bunch of junk.
(3) What ever money we get out of AOL in the meantime is gravy in effect AOL users are now helping to pay for an expansion to our system, so it's in our best interest to upgrade it right, lets just be sure we charge AOL more than they can pay for, and that should not be a problem.
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Well that may not be the exact senora that's being played out, but it's in the ball park, and not out side the foul lines. SEE
boardwatch.com
In October 1996, BBN announced a $340 million, four-year agreement with America Online to provide services to build-out the AOLnet TCP/IP dial-up network currently operated by ANS CO+RE Systems.
AND also note:
In June 1995, BBN Planet and AT&T entered into a strategic relationship under which BBN Planet is to be the exclusive provider for a period of up to three years of dedicated Internet access and managed network security services to AT&T for resale to customers of AT&T's Business Communications Services division ("BCS") in the United States. During such three year period, as long as BBN Planet is the exclusive provider of dedicated Internet access and managed Internet security services to customers of BCS,
BBN Planet is prohibited from providing such services to, or in conjunction with, other telecommunications carriers or online service providers. Under the agreement, AT&T provides certain incentives to BBN Planet to develop additional Internet-related value-added services for sale to such customers.
BBN Planet will also provide training and sales support and post-sale
implementation support to AT&T.
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So put 2 & 1 together, and you have AT&T who is pulling the strings at BBN, serendipity getting BBN to build up the AOL network, and you would have to be crazy not to think about the motive. <VBG>
The take over could be a while in coming, as I doubt AT&T is in any hurry to pick up the crap AOL now has in place.
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16 bit version winsock.dll
Like did you know a lot of the AOL servers are so old they will not handle a 32 bit operating system..visit netscape and find out that to use navigator 3.X on AOL you must use the 16 bit version, as AOL re-writes your win system file winsock.dll with their own version which is a 16 bit version, so as to be compatible not so much as with their software..as they would have you to believe..but of a need in regardes to most of their old servers that are still running from the BBS days.
Some Advise to AOL users that sign off that I bet AOL don't give,
go find your winsock.dll..if its about 11 k look for one named winsock.old that's about 57 k ( the 32 bit version ) and rename it back to winsock.dll,
you will have to rename or erase the other one first..rename it winsock.aol if you want to keep it. Yep behind the scenes AOL turns your computer into a 16 bit operating system even if your running a entium, and win95..you are tossed back into the stone age when you have to go on line with 16bits (instead of the 32bit system that is now standard for the rest of us ) ..and this is not going to be fixed any time real soon..so if you do mangage to get on between BUSY signals and wonder why AOL is so slow..well
this is just one of the many reasons.
If you ever installed AOL software..and go to a local provider, be sure you re-do your winsock.dll..or you will likely have trouble with any 32 bit software you try to run over TCP/IP..do you wonder why AOL don't tell you about this ? Maybe they do some where..but if so most users can't find it, and I didn't have to be told ( I do end user support work) and knew to look..and have serviced many that I had to change, I just do a copy and over write their piece of junk..and tell the customer for heavens sake you have nice new fast computer here..don't install any more AOL stuff..it will cut your TCP/IP processing to half speed. Most of them don't know what I'm talking about but when they SEE the difference
logged onto a local ISP..and running in 32 bit mode..they just take my
word for it :-)
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I did not mean for this to get so long, but in as much as I'll point others to it, who have more interest than the sinking book value of AOL ; by making this broader, I take some load off myself in replying to the many letters I'v been getting. You can stop reading anytime you get bored. <G>
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PUTS/CALLS on AOL...I spend about 80 hrs a week on line 3/4 of that is looking for plays I can make in the stock market, I'm no expert..but well above average, there are many values I don't see, so I just have to stick with ones that I can recognize and jump out at me. I do a lot of scaning and was looking at other places , but on Jan 17th I happened on AOL..my god I thought
that is a stock I think I can get into and understand..the learning curve has been fairly rapid since Jan 17th, and I'm sure there is still more I don't understand about her than I do..but so far I have understood enough since the 17th to have hit her both ways twice on puts..and once on calls, I'v opened 5 positions, closed 3 as winners..and have 2 put positions open and if I lose both of them compliantly I'll still be ahead on AOL.
I'm looking to open another put position ASAP when it meets my criteria, ( which has now become a lot more pragmatic than when I placed the other bets ) if it moves into my window this new position will likely be larger than all of the other positions I'v taken on AOL put together up to date.
So far I'v just been warming up to her <G>But with 3 hits back to back, I'm now ready to take a big swing.
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taken from PBS 02-07-97 after close
just march based on close prices
.AOLCG C MAR 97 35.000 3 1/2 -1 1/2 4 1/8 3 1/4 142= $ 49700
.AOLCU C MAR 97 37.500 2 5/8 -3/8 2 7/8 2 1/2 194 =$ 50925
.AOLCH C MAR 97 40.000 1 9/16 -7/8 2 7/8 1 1/2 334 =$ 52187
.AOLCV C MAR 97 42.500 1 1/16 -11/16 1 5/16 1 1/16 123 =$ 13838
.AOLCI C MAR 97 45.000 3/4 -3/8 15/16 3/4 165 =$ 12375
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long interest = $ 179025
.AOLOG P MAR 97 35.000 3 +5/8 3 1/8 2 3/8 298 $ 89400
.AOLOU P MAR 97 37.500 4 3/8 +1 3/8 4 1/2 3 3/4 20 $ 8750
.AOLOH P MAR 97 40.000 5 7/8 +3/8 6 3/8 5 3/8 736 $432400
.AOLOV P MAR 97 42.500 7 3/8 +1 5/8 7 3/8 7 3/8 5 $ 3687
.AOLOI P MAR 97 45.000 10 +1 1/4 10 9 1/2 2 $ 2000
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short interest = $ 536237
short interest is almost 3 to 1
she will fall by ex date march
with the big money saying she
will be 34 1/8 or lower.
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What do I make of the above ?
.AOLOH P MAR 97 40.000 5 7/8 +3/8 6 3/8 5 3/8 736 $432400
That was one big money bet ( generally called smart money ) as these
big bets are not laid down on whims. likely 700 went to one fund, the other 36 to people like my self. some one is betting 700,000 shares ,AOL will go to 34 1/8 or lower by ex date march..hmmmm they paid 5 7/8
with stock at 35 7/8 ...so if stock goes up a little I know how
to pro rate that and how much I should pay to get in march.
I could just grab his shirt tail, but I want a bargain, and if I'm
diligent with watching her I might get in under him, if I don't get
in under him I'll by-pass march. If I do I'll lay as big a bet as
I can afford.
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What's my hunch..well some one wants out of AOL, they own about 700,000
shares and they have made a des ion to dump them by ex date march,
that many real shares getting dumped (is not just the day trading
swapping thing that we see every day) This is for real..700,000 more
shares will hit the float ..hmmm and if that happens he wants to
be sure he gets 34-1/8 ( I think I know who this is but will not
put that in SI ) they will come out ahead if they dump out at
34-1/8 , and it appears that's their plan no matter what else happens
to the stock..they get out..likely got in around mid $20,
What I guess the average Joe may not realize is when you have that
many shares they are not so liquid..just selling them off can kill
the price before you get a 1/3 of the way through, so the puts
take care of the liquid problem. Who ever wrote those puts is in
for a surprise, they are going to inherit a lot of AOL stock
in march <VBG>
Now I don't have to buy the 40 puts, but I do want to prorate things
on other puts to get under that above put buy percentage wise
if I go into march;..to much for me to explain here and now, but
it's a good problem for people to work out. There is no guarantee that
a bet made at or even under that premium will pay off..but the
odds are sure good, that guy did not just bet on puts..he fixed his
min. exit price..and will exit..after all to spend 4.2 million to
set it up it is not likely he'll walk away..I'm sure he would like
to get more..but I'm also sure he will be happy as hell to get
out at that price. Will it send her way down, I don't know..but
it could, it could be a worse blow to her stock than all the bad
news has been , who the heck is going to buy that much..most of
the volume we see is just day trading amongst some MMs in a sort
of daily poker game, but 700,000 more shares for the public to
absorbed it will hit just about as hard as if AOL had made another
public offering..which by the way Steve has mentioned as one way,
to finance this system upgrade. that it may raise enough to let
AOL pay her debts and put off a take over..if he does that the
stock price will really tumble..likely to $10..put that don't
matter to Steve..if it lets him keep his kingdom..why worry about
the stock holders, they are just little seedy greedy creeps that
want to get rich off AOL any way..Steve he sees the future..the
long term....that's why there are no problems at America
Offline..Steves vision..is so extravagant.
Well I need to stop as I'm laughing at my-self and that's not a
good sign..I have been dieing to say one thing..and I may as well
get it over..the A in AOL should not stand for America, it don't
fit..it's more closer to that part of the anatomy that begins
with an A, but is referred to by a proctologist as something else.
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Jim
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