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Strategies & Market Trends : Roger's 1998 Short Picks
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To: Pancho Villa who wrote (7908)4/28/1998 7:07:00 AM
From: Ploni  Read Replies (1) of 18691
 
AOL thinks its shares are cheap
Online service 'very comfortable' with estimates
By Tom Murphy, CBS MarketWatch
ÿ
SAN FRANCISCO (CBS.MW) -- Are America Online shares about to scream
higher? The company thinks so. CFO Len Leader told an audience of money managers on Monday that the world's largest online service providers sees its share value rising to $149.50. That's more than double their current price.

Leader gave the estimate at the Hambrecht & Quist technology conference in San Francisco. He also said the company (AOL) was "very comfortable" with earnings estimates of 12 cents a share for the quarter that ended March 21. That figure excludes three separate charges that are expected to total less than 24 cents a share.

[snip]

Assessing the company's share price, Leader said the company's projected U.S. membership of 14 million for the coming year alone would suggest a value of $87 a share. He valued the company's advertising and online commerce revenue at another $50 a share. International membership adds another $7.50 a share, and the company's investments and cash are worth $5 a share, he said.

That adds up to $149.50 for AOL shares. Whether it'll add up for
shareholders is another question.

* * *

I didn't think that CFO's were supposed to predict a price for their stocks? Can't that open them up for future lawsuits, if the stock doesn't perform?
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