America On-Line: will it survive ...? Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Christopher Grace who wrote (6696)	1/6/1998 8:20:00 PM
From: Todd Daniels	Read Replies (1) of 13594

>>Given that AOL has over $250M in guaranteed future ad and e-commerce >>revenue under agreement or already paid-in and waiting to be booked, AOL's underwriter, BA/Robertson Stephens, has noted in it's reports that the average life of the $240m is three years. That's $80m per year; $6.7 million per quarter -- $0.67 gross per share per year; $0.17/Q. Even if margins are 70%, at AOL tax rate of 40% that's $0.28/shr net per year; $0.07 per quarter. AOL is trading on expectations for over $1.60 in F99 and $2.95 in F00. That's very aggressive presumption of future deal flow. I agree that high speed access isn't the issue. Neither is membership. AOL's biggest challenge isn't growing members or even keeping existing ones, but keeping them in ad space controlled by AOL. As web content becomes better and better and more and more AOL subs become less newbies and more adventurous, keeping subs in AOL space becomes more difficult. It boils down to content. In that it's AOL against the multitudes spending billions on the Web. Odds of 'killer content' coming out of AOL versus that is like comparing odds of life on Mars with odds of it in the entire universe.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next