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Technology Stocks : America On-Line: will it survive ...?

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To: paul jackson who wrote (3922)7/10/1997 7:06:00 PM
From: Thomas C. Donald   of 13594
 
Paul: AOL is expected to earn approximately $95,000,000 in the fiscal year which began last week. This includes the profits from the zillions of advertisements you envision. If 122,000 customers (only 1.7% of AOL's current 7,000,000 customers) moved each month from a $19.95 dial-up access plan to accessing AOL's services via the internet, this entire profit would be wiped out. This is assuming that AOL can continue to get away with charging $9.95 per month for access to its services from the internet. Sounds risky to me! Does this company merit a 1998 P/E of 80 while Intel (a relatively sure thing) only rates a P/E of 15?
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