phelan,
if you analyze, IMHO this news isn't big enough to drive this stock to break beyond 45. To break 45 aol needs a real big news which will not happen.
Currently, they are very much interested in promising and working towards the increase of modems,etc. This industry is very volatile.
If you find a problem in capacity planning and you are trying to fix it in 6 months, the customer isn't going to wait. They get pissed off. Even if the problem is solved in june, the scene changes by that time. Lot of small ISPs will be crawling between the legs of AOL. This will be a major hurdle for AOL then.
And also you never know, some other problems will creep up.
As a whole, I will "Bet on the jackie rather than the horse".
The management(jackie) of AOL is not trying to place themselves as long term players. They get over excited and become blind for long term planning.
From the past experience with MSFT,INTC,IOM,CUBE(i am also including the stocks iom and cube for high volatility), they have some solid fundamentals to be innovative and creative.And interest for the future too (atleast few years).
But, i dont see anything from AOL like that except releasing some jazzy news and color graphics on screen. Nonetheless, every quarter they find a way to writeoff the loss. They are really good at manipulating the accounts.
Also, wallstreet looks for the industry leader, thats it. Technical fundamentals are built by being innovative,creative and especially customer service for this industy. Not by cheating the customer without giving credit,Sending books etc and charging on credit card(you will know only when the statement comes). These are just examples i felt like mentioning.
At this point, and whenever i look at AOL i remember a story.
Two people A and B meet(they don't know each other before). A smiles to B and chats for a while and gives mangoes(is it free?) to B. While B is hesitent to accept the mangoes, A insists to take them. After this, A catches a bunch of hair of B and says you can't return the mangoes and you have to pay me money (which is again exorbident for those mangoes).
Ofcourse, A here is AOL.
What is the position of AOL down the line 3 years or 5 years?. IMHO the answer is big &(*``!@#$$&*^%@#@.
Any comments |
