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Non-Tech : Any info about Iomega (IOM)?
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To: E. Graphs who wrote (47294)2/9/1998 1:01:00 PM
From: Ken Pomaranski  Read Replies (4) of 58324
 
Sorry, I have to talk about AOL:

You think that AOL is a good short because it will make the same
amount per share as Iomega, and is priced 10x of Iomega.

This is a VERY bad reason. Here's why:

(1) Studies have been done which show that there is NO correlation
between PE and stock performance. The analysis going on here
comparing PEs to growth rate, etc... cracks me up. (Of course,
it is the conventional wisdom, so it must be right!)

(2) AOL has a recurring, stable revenue stream. No worry Q to Q about
1/2 their subscribers disappearing. There really is no meaningful
competition.

(3) AOL is a money machine. They can use this money to expand, grow
into other areas. Iomega has to spend all their cash just to
stay afloat, and keep ZIPS on America's minds. AOL has no work
to do to keep existing customers

(4) Advertizers are falling all over themselves to get onto AOL.
Demand is strong, and will get stronger as time goes on.

(5) AOL future is clear and bright. Iomega? future is uncertain.

Good luck!

kp
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