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: Harry Larson who wrote (914)	1/6/1997 4:56:00 PM
From: Joel Sternberg	of 13594

>You quote as fact ("early results") * not AOL reports *, but `estimates' from the analyst at AOL's investment banker, who has been the most shameless bull on AOL -- even all the way from 70 down to 25. (He also tried to talk 3DO up, another AxB IPO, all the way down). Because 70% of AOL subs didn't use more than the 5 hours in the $9.95 plan, it's hard to see how 75% would convert knowingly, willingly, or permanently to $19.95. Also, the $16.85 was down from $17.43 the prior quarter and $18.72 before that.< In fact, according do Zack's, there have been continuing downgrade of earnings estimates for the fiscal fourth and first quarters. It is funny how AOL now wants to talk about cash flow. When they were playing deferred subscriber acquisition games they weren't interested in talking about cash flow. Right now I imagine that Case and company are cooking up business model #43. I also would not be surprised if AOL did book pre-payed membership dues as current revenue. Technically, I do not think it is a violation of accounting rules, and AOL sure know how to bend those accounting rules.

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