Merrill's Blodget Less Bullish on America Online, NYT
Reports
Bloomberg News
August 8, 1999, 1:25 p.m. PT
New York, Aug. 8 (Bloomberg) -- Merrill Lynch & Co. Internet
analyst Henry Blodget is less optimistic today than he was six
months ago about the business outlook for America Online Inc.,
though he still rates the stock a ''buy,'' the New York Times
says. AOL, like other Internet stocks, is vulnerable to higher
interest rates because of its lofty price-to-earnings ratio, and
faces fierce competition in Europe, where many companies are
offering free access to the Internet or are ''bundling'' access
with computer sales for a single price. In the U.S., AOL is being
challenged by cable companies offering fast Internet connections
and the likelihood that Microsoft Corp. will sell cheap access to
the Internet or give it away for free, the paper said.
AOL shares slid 10.9 percent on the New York Stock Exchange
last week, with much of the decline coming Thursday amid concern
that Microsoft will trim or eliminate its Internet access fees in
a move that could cut AOL's revenue. |
