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Technology Stocks : America On-Line (AOL) -- Ignore unavailable to you. Want to Upgrade?

To: Brasco One who wrote (26155)	7/21/1999 1:25:00 AM
From: puborectalis	Respond to of 41369

Can AOL Beat the Whisper Number? Tell us what you think in AOL's Board. Can AOL Beat the Whisper Number? Will Ziff-Davis Find a Way to Unlock Value? UPDATE: UCBH Holdings Emerges as an Interesting Demographic Play DID YOU MISS A DAY? Last 7 Days Archived iionline.com by Eliot Walsh (7/19/99) This Thursday night, America Online (NYSE: AOL - Quotes, News, Boards) will announce fourth quarter results. According to I/B/E/S, the No.1 Internet Service Provider should earn $0.11 per share--a 332% gain over the year-ago quarter. The whisper number, the unofficial number analysts expect earnings to match, is about $0.13. 'Expanded subscriber growth will be the key to beating the estimates,' says Terry O'Brien, senior technology analyst with Richmond, VA-based Branch, Cabell. He expects to see earnings of $0.12 per share, noting that AOL's intense drive to add products such as Drkoop.com and services such as the ICQ instant-messaging community to its business has contributed to AOL's staggering $1.2 billion in advertising revenues. The company will soon overtake leader NBC for the position of the No. 1 media company in the world based on ad revenues. Like this Article? The astonishing number of consumers flocking to AOL properties bears out O'Brien's assertions. Including CompuServe, AOL boasts 19 million paid subscribers, making it the dominant ISP worldwide. But that's only part of the story. On July 15, AOL announced that more than 750 million messages are sent through its Buddy List and its ICQ service--every single day! To put that into perspective, that amount is 50% greater than the number of letters sent by U.S. Mail on a daily basis. AOL's Buddy List and Instant Messenger services together boast 40 million registered users, while ICQ adds another 38 million to the audience. 150,000 new people register for these services every day. All those users have been contributing to AOL's towering brand-name awareness, obviously one of its most critical assets. But Jim Preissler, who covers AOL for PaineWebber, is less intrigued with Thursday's numbers than in the discussion and Q & A that will accompany them. And while he sees the company doing very well, he doesn't anticipate that the company will crush estimates. 'As far as metrics go, we foresee total revenues of $1.3 billion, with the breakout number being online services, which see at $930 million,' he says. 'We put [advertising and e-commerce revenues] at $290 million, and enterprise [the Sun Microsystems/Netscape e-commerce development business] at $113 million. That's a net income of $113 million, of $0.11 per share.' Beyond the earnings, Preissler wants to hear what the company has to say about three issues in particular: (1)'where we are in the scheme of things' as far as DSL is concerned; (2) the recent cable broadband court decisions at the local level; (3) the company's experimentation with rebates for PC's in exchange for ISP service agreements. For the near term, Preissler envisages the company taking 'a more brute force' approach to earnings, the concept being that this will foment 'steady strength and consistency' for the stock. He likens that kind of stock performance as 'more like a Microsoft than a Yahoo.' Will that help ease the stock's volatility? If investors catch on to the company's new posture, he believes it will. The Branch, Cabell Research Profile for AOL notes that the company has 'beat analyst estimates made a year in advance (our measure of performance) by at least 70% for the last five quarters-a significant accomplishment.' But in recent quarters, investors have become much more sensitive to earnings news than they were just a year or two ago. When, in June 1998 AOL missed fourth quarter estimates by a mile, the stock hardly budged. How times have changed. Some may remember that in the week before 3Q99 earnings were announced April 27, investors bid up shares of AOL from$128.69 to over $162 on April 26. The company reported $0.09 the following day, meeting estimates. But the day after that, shares of AOL dropped $10. Within a week or so, they were trading for between $120-$130 apiece. Bottom line: look for America Online to at least match earnings estimates. Whether they blow out earnings or not, Thursday's numbers should demonstrate that management is running a tremendously solid juggernaut that's poised to continue to grow exponentially and dominate the ISP market. Whether that will be good enough to keep investors long is much more debatable. Tell us what you think in AOL's Board Like this Article? Back to Top

To: Brasco One who wrote (26155)	7/21/1999 10:07:00 AM
From: Sam	Read Replies (3) \| Respond to of 41369

i believe we were talking when the pig was at 160. its been hard for aol... hehehe! NEXT!!! Yawn. Confusing the market gyrations with the stock again, aren't you? The summer doldrums will pass, and the fall tech bonanza will begin all over. Do you remember last summer? It was about this time that the techs took one HELL of a beating, and the shorts we're jumping up and down like spastic little children saying I told you so ... ... only, the downturn was temporary, and those that had half an investment brain went LONG, and are sitting on gains closing in around the 1000% area. Meanwhile, the shorts cowered back into their little holes, licking their wounds and eating their tulip bulbs. And so the story goes, and the torch gets passed, and it ends up in the hands of shorts like yourself. Enjoy. Make a dollar or two, hell make three even! Just make sure to post how good a short AOL is, and all the fantastic due diligence you have done to support your claims. In the end, the stock will take care of itself ... and all those bold enough to short it. Enjoy, $am -- as piggy as I was three years ago!