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

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

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To: Frank Ellis Morris who wrote (13355)	12/30/1998 8:46:00 PM
From: Labrador	Read Replies (1) of 13594

Earnings -- Can we assume? Added 1 million more subscribers, and at $22 per month equals $22 million per month or about $260 per annum. This is just for the latest 1 million subscribers. Can we assume that there are no fixed costs associated with this latest addition, and that the $260 drops to the bottom line (pre-tax earnings)? If so, just the latest million subscribers adds about 31 cents to annum earnings, and about 8 cents per quarter. If they can add, 1 million subscribers every 60 days, they will be doing tremendous. Then wait for the price to increase from $21.95 to say $22.95. Yee-hah. 1 million subscribers @ $263.40 per year/465 million shares outstanding x 60% after-tax rate = 34 cents. so say 31 cents.

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