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Technology Stocks : America On-Line: will it survive ...?
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To: jack rand who wrote (5012)10/10/1997 5:28:00 PM
From: J.S.   of 13594
 
">>How do these estimates deal with loss carryover?
>>That was big source of debate last quarter.

Huh? I have no idea what you are talking about."

If they make,say, $.10/share in particular quarter before taxes and
then use the operating loss accumulated from previous quarters to
offset the income, then they may pay little or no taxes and hence
the after tax earnings would be also about $.10/share. If they don't
elect to use the loss carryover, they can only claim $.07/share after
taxes. My question is (and I realize that no one may be sure of the answer): Are the earnings forecasts inclusive of the tax loss benefit accumulated over the years?

What really complicates the issue is that AOL will actually lose
money for the foreseeable future but will keep attributing it to
extraordinary items. In that case they don't even need to elect
to use the tax loss accumulation to claim after tax profits
equivalent to before tax profits.

I hope this helps.

Joe
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