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

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To: Eric Klein who wrote (8263)2/25/1998 2:59:00 PM
From: SJSharky  Read Replies (3) of 13594
 
The intrinsic value of a company comes from it's earnings.

Agree, but the market value of a company comes from how much future earnings potential it has. IF they can achieve the type of profit growth the street is expecting, then I believe the current valuation is justified.

However, I don't believe you can continue to grow that type of advertising $$$ quarter on quarter which is what they need to achieve their revenue targets for the next year. The accounting games don't really worry me because, let's face it, every company does it. So AOL may bend the rules a little more...in the end, it all catches up with you. Right now, I'm not going to mess with this monster as the street could drive it up to 150 before it tumbles.

--Ryan
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