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: Brent D. Beal who wrote (4868)	9/19/1997 5:30:00 PM
From: Tim Kenney	of 13594

>What I can't believe is analysts still don't get it--it's the web that's the killer app (the web and e-mail--see the recent issue of BusinessWeek). These latest deals (MSFT and AOL, Barnes & Noble, etc.) only reinforce this viewpoint.< Analysts are generally worthless, but not as dumb as you think. Investment banks make their juiciest fees on underwriting deals, and there has been a feeling on Wall Street that AOL will eventually have to issue more stock. Thus the kind words. You will notice that Netscape's final plunge did not happen until they had completed their secondary offering, and would not need Wall Street for a good while. I still remember Goldman Sachs recommending them at 53 in late 1995. Do you think Goldman lost business because of that? Doubtful, since most knew why they issued the recommendation. Netscape has probably executed its business plan as well as anyone could have expected, but it did not do much for a bloated stock.

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