| Actually AOL just wrote off 40-60 billion in Goodwill so that figure you use is out-dated. The stock just came down 50% for the reasons you give. They deserve to have a huge intangible value because of all the dominant media brand names and copyrights they own. Hundreds of them. All the creme de la creme names in cable, TV, music, film, magazines, books plus tremendous franchises at work now like LORD OF THE RINGS (best picture Oscar?), HARRY POTTER, THE MATRIX, etc. My calculation is that the company is worth 125 billion in a neutral economy. More when growth is evident. That will be mainly when ad revenues improve. And I believe they are, gradually. That said, I'd rather own true value/growth stocks right now like HAL, PALM, SCRM and SKX. Am also starting to like the beaten-down wireless companies, some of them. But AOL is a keeper and I disagree it will ever go down to $20. Time-Warner alone is worth $20. |
