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Technology Stocks : America On-Line: will it survive ...?
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To: moose who wrote (6264)12/9/1997 12:18:00 AM
From: Brent D. Beal  Read Replies (1) of 13594
 
In my mind one of three things have to happen for AOL to begin the long descent down:

1) investors need to start recognizing that AOL's service sucks and that subscriber growth isn't going to continue

or 2) advertising revenues aren't going to grow exponentially

or 3) the long bull run is over and it's time to get out of the speculative, bigger-idiot, momentum stocks like AOL.

I wouldn't buy puts unless you have a reasonable expectation of movement along one of these three fronts. Immediately after earnings I believed that 2) and possibly 3) were driving the stock price and it did drop to a low of $64. Now 3) no longer seems to be a threat and everyone seems to have explained away 2). It won't be so easy when ad revenues are only flat to slightly up this quarter, but that's another story. . . Good luck.
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